Private Equity Firm Acquires Medicaid-Focused Home Care Company

Boyne Capital Partners announced yesterday that it acquired AmeriBest Home Care, Inc., a Philadelphia-based home care provider that serves seniors and disabled residents throughout Pennsylvania. The Miami-based private equity firm closed the deal in partnership with AmeriBest management, which will continue to handle operations.

“We were impressed by the high-quality, dynamic leadership team at AmeriBest, led by Omar Khanataev,” Derek McDowell, Boyne managing partner, told Home Health Care News. “They have a great focus on regulatory compliance and data, which you don’t always see.”

McDowell declined to disclose the purchase price.

The Medicare- and Medicaid-certified home health agency focuses on Home and Community Based Service (HCBS) Waiver programs, which states can use to support the needs of people who prefer to get long-term care services at home rather than in an institution.

Under HCBS waivers, states can forgo certain Medicaid program requirements. States are given the opportunity to target waivers to areas where need is greatest, to make services available to groups of people who are at risk of institutionalization, such as the elderly, and make Medicaid available to people who would otherwise only be eligible in an institutional setting.

Nearly all states offer HCBS waivers and currently more than 300 such programs are active nationwide, according to Medicaid’s website.

Boyne plans to grow AmeriBest more broadly throughout the state of Pennsylvania and other states in the Midwest, McDowell said. Its services are currently focused on the communities surrounding Philadelphia.

The transaction, which was completed in March, represents the most recent platform investment in BCM Fund I, which the private equity firm recently closed with $126 million of total capital commitments, exceeding the original goal of $100 million, according to a July 13 press release.

The fund targets lower middle market investments, specifically companies with less than $100 million in revenue and with EBITDA of $2 million to $10 million, according to a press release announcing the acquisition. Boyne Capital Partners focuses on these lower middle market companies in a range of industries, including health care, agriculture, consumer products, niche manufacturing, and business and financial services.

The home care company generates over $30 million in revenue annually, said McDowell.

AmeriBest CEO Omar Khanataev will continue to lead the company’s daily operations.

Boyne recently hired CFO Brian Ko, an experienced health care executive who was previously a financial operating partner at private equity firm Graham Partners, to provide operational and financial leadership, said McDowell.

This acquisition is just one of many private equity investments in the home care sector over the past year. As of the third quarter of 2016, more than 50 home care and hospice transactions involved private equity buyers, compared with fewer than 30 of these transactions in all of 2015, according to proprietary data from M&A advisory firm The Braff Group.

Written by Elizabeth Jakaitis

Photo credit: “Philadelphia” by Bruce Emmerling, Pixabay