Dive Brief:
- HealthSouth Corp. has revealed its intention to purchase Reliant Hospital Partners, a private rehabilitation hospital operator, for $730 million in cash.
- The purchase will increase HealthSouth's presence in the Texas markets of Houston, Dallas-Fort Worth and Austin, as well as give it a new presence in Abilene, TX, Dayton, OH, and Boston, MA.
- Reliant has 11 in-patient rehabilitation hospitals and three in-patient satellite facilities that make up a total of 902 beds. Its reported revenue for 2014 was about $249 million.
Dive Insight:
HealthSouth—already the largest in-patient rehabilitation facility provider in the U.S.—will even further dominate its local markets on this purchase, analysts note.
While in-patient rehabilitation is the company's main business, it is also ramping up its home health services. In late 2014 it purchased Encompass Home Health and Hospice, which added 140 locations in 13 states.
It's likely that HealthSouth will aim to grow its home health services in the new markets it's entering, Obsidian Research Group analyst Toby Wann says. The industry can expect it to start new home health agencies or buy its smaller rivals.