With the ink barely dry on its most recent acquisition deal, Kindred Healthcare has jumped back into the M&A market to scoop up Centerre Healthcare Corp., an inpatient rehab provider.
Louisville, Ky.-based Kindred offered $195 million in cash for Centerre, which operates its 11 rehab facilities in partnership with acute-care providers. The deal is expected to close in the first quarter, pending regulatory approvals.
Kindred has five inpatient rehabilitation facilities, as well as 102 hospital-based acute rehab units, and estimates that the combination will make it one of the largest rehab providers in the country. Moreover, Centerre's hospitals are near five of Kindred's “integrated care markets,” where it aims to provide a spectrum of post-acute care services for patients graduating from acute-care.
Its $1.8 billion acquisition of Gentiva Health Services, an agreement for which was finalized last month and which is also expected to close in the first quarter, similarly helps further its care coordination strategy. Kindred has been experimenting with risk-based payment models, and is participating in the CMS' bundled-payment demonstration project in partnership with the Cleveland Clinic.
Kindred last year launched a strategy to build its home health and rehabilitation divisions while shifting its focus away from skilled nursing.
On its most recent earnings call for the third quarter, incoming CEO Ben Breier detailed that operating margins continued to improve in its RehabCare business, increasing to 11.7% from 11% during the third quarter of 2013.
Centerre, based in Brentwood, Tenn., was named one of Healthcare's Hottest companies by Modern Healthcare in 2012.
Follow Beth Kutscher on Twitter: @MHbkutscher
