VistaCare is on a mission to build a hospice empire, and it's well on its way with two recent deals.
The latest was announced June 17. Under it, Scottsdale, Ariz.-based VistaCare will merge with Dallas-based Family Hospice. The merger is expected to close by July 15.
A month earlier, VistaCare agreed to buy the hospice business of Vencor, the Louisville, Ky.-based long-term-care company. Terms of the Vencor deal, which is expected to close sometime in the third quarter, weren't disclosed (May 18, p. 4).
All told, the deals will make VistaCare the nation's largest provider of hospice services with 50 hospice operations in 15 states.
The company will surpass Vitas Healthcare Corp., a Miami-based hospice company, which operates 27 hospice programs in seven states.
"We have a goal and vision to create a national platform to change how end-of-life care is being delivered," said Barry Smith, president and chief executive officer of VistaCare.
Smith added that VistaCare will grow both internally and by acquisition, but he would not identify potential acquisition candidates. The privately held company also plans to go public within two years, Smith said.
Gary Krueger, chief operating officer of Family Hospice, which also is privately held, said size is important in hospice care for added value. "Under the current regulatory and managed-care environment that hospice as well as other healthcare providers are operating under, it's almost necessary to take advantage of economies of scale to improve on quality services," he said.
The merged VistaCare and Family Hospice company will be headquartered in Scottsdale and adopt the VistaCare name. However, current Family Hospice sites will keep their name, and some administrative duties will remain in Dallas. All Vencor sites will be renamed to include VistaCare.
Revenues for the combined companies will exceed $75 million. Financial terms for the deal were not disclosed, although Smith said the deal would consist of stock held by the private owners and cash transactions. Neither company would release information on its financial performance.
The companies said that legal counsel told them they do not need to seek federal antitrust clearance.