Actinium Healthcare Holdings — a Dallas, Texas-based private equity firm — has acquired Central Home Health Services of Texas Inc. The PE firm announced the acquisition last week, touting it as a stepping stone toward building a broader health care platform company.
The financial terms were not disclosed.
Houston, Texas-based Central Home Health Services of Texas is an in-home health provider that operates in five counties, mostly working in the Texas Medicaid payment landscape. The provider brought in roughly $5 million in annual revenue in 2019.
Actinium’s acquisition of Central Home Health Services of Texas is just the latest move in its home-based care playbook. The PE firm also recently acquired Houston-based provider Action Home Health in a separate deal.
Central Home Health Services of Texas’s growth potential made it an attractive acquisition target, according to Jessica Ives, CEO and president of Actinium.
“All of their referrals came directly from insurance [sources], so they have this great funnel of referrals from case managers that they’ve built relationships with over time — and different insurance companies, different programs in the Houston area,” Ives told Home Health Care News. “I knew, with just a little bit more effort in that area, I could grow this company rapidly.”
Currently, the company has plans to merge Central Home Health Services of Texas with Action Home Health.
As a former nurse practitioner with a background working in mostly acute settings, Ives saw the value of home health firsthand over the years.
“I kept seeing the same problem of us not being able to send home our patients because there wasn’t a viable option for them,” she said. “They got caught up in this acute care circle. My patients just wanted to go home and be taken care of. It became a driving passion for me to get to a point where I could provide that for these people, allowing them to age in place at home.”
While Actinium is passionate about care in the home, finding the right acquisition target and doing their due diligence has become increasingly important.
“Some [companies] are for sale for the wrong reasons,” Ives said. “For example, maybe they have a bad license or ran the company poorly or into the ground, and now they’re trying to get out. We found one company had a massive tax lien, and they were trying to hide that. Things like that have been a challenge, but looking at the larger picture, we’ve had good experiences.”
The company also experienced some disruption to M&A activity due to the COVID-19 emergency, according to Ives.
“[There was difficulty when it came to] due diligence and being able to gather information in a timely fashion,” she said. “A lot of agency offices … weren’t open. The business bankers are not always available, so just to take control of the accounts has been difficult. The change of ownership with COVID-19 has been difficult, again, because a lot of the offices are not open.”
Looking ahead, Actinium has plans to continue growing within the home-based care space.
“Our mission is to provide care services at home for the elderly, so that we can keep them at home as long as possible,” Ives said.