Add Sun Healthcare Group to the list of providers homing in on the respiratory therapy market.
The Albuquerque, N.M.-based nursing home chain agreed to buy Golden Care, the nation's largest privately held respiratory therapy services company, in a stock deal valued at $55 million.
"This merger will expand Golden Care's customer base for its respiratoryRespiratory therapy
therapy services by giving it access to the 500 facilities currently serviced by (Sun's rehabilitation division)," said Andrew Turner, Sun's chairman and chief executive officer.
Indianapolis-based Golden Care provides respiratory therapy to the sub-acute-care industry. The company re-corded net operating income of $4.6 million and net revenues of $14.8 million during fiscal 1994. Under the deal, Golden Care shareholders will receive 2.1 million shares of Sun stock.
The deal is expected to be completed during the second quarter of 1995.
So far this year, several home-care and nursing home chains have added respiratory therapy to their array of alternate-site services. Home respiratory therapy is estimated to be a $2.5 billion business that has grown steadily over the past few years without a dominant market leader.
Homedco Group's $1.1 billion merger with Abbey Healthcare Group in March marked the first time two prominent home-care companies joined forces to become the nation's largest home respiratory provider.
In April, Coram Healthcare Corp. threw its hat into the home respiratory market by purchasing Lincare Holdings in a $1.1 billion deal, thus forming the nation's second-largest home respiratory company. Sun's merger is considerably smaller than its home-care counterparts'. However, the crossover opportunities from the merger will provide Golden Care with much greater access to the national respiratory therapy market, a Sun spokeswoman said.
Sun Healthcare Group operates 118 nursing homes and nine ambulatory surgery centers nationwide.