Benzinga | Jun 25, 2021 07:01AM EDT

Akumin Announces Agreement To Acquire Alliance HealthCare Services; Transaction Has Enterprise Value Of $820M

Akumin Inc. (NASDAQ:AKU) (TSX:AKU) ("Akumin"), a premier provider of freestanding outpatient radiology services in the U.S., announced today that it has entered into an agreement to acquire Alliance HealthCare Services, Inc. ("Alliance"), a leading national provider of radiology and oncology solutions to hospitals, health systems and physician groups. The transaction, which has an enterprise value of US$820 million, is expected to close in the third quarter of 2021 subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. The combined company is expected to have pro forma revenue in excess of US$730 million and pro forma adjusted EBITDA in excess of US$210 million, including expected cost synergies, based on the last twelve months ended March 31, 2021.

Upon the closing of the transaction (the "Closing"), the combined company will offer the most comprehensive radiology and oncology solutions to patients in the U.S., operating in 46 states, with more than 1,000 hospital and health system customers, 154 independent outpatient radiology centers and 34 radiation therapy centers. The combined company expects to have over 4,000 team members serving more than two million radiology and oncology patient visits annually.

"We have always said Akumin's vision is to drive patient-centered innovation, service delivery standardization, and exceptional healthcare value, all in an outpatient care setting," said Riadh Zine, President and CEO of Akumin. "The acquisition of Alliance is transformative in a changing healthcare ecosystem that continues to shift toward outpatient, price-transparent, value-based care. There's no other organization that has the complement of attributes we will offer together as outpatient healthcare services experts, in particular with Alliance's longstanding hospital and health system relationships and Akumin's freestanding operational expertise."

"Bringing together the best of both organizations for the benefit of our patients, partners and customers is truly exciting," said Rhonda Longmore-Grund, President and CEO of Alliance. "Alliance brings an over 30-year history of successful radiology and oncology partnerships with hospitals and health systems; and Akumin has built and continues to grow its premier outpatient imaging practice. Together we will offer patients and customers profound value unlike any other healthcare solutions company -- and we can't wait to get started."

"We thank the Alliance team for five years of partnership, and we look forward to the success we know Akumin and Alliance will achieve as a combined organization," said Qisen Huang, Chairman and Founder of Tahoe Investment Group. Tahoe has been majority owner of Alliance since 2016 and will on closing transition to a minority ownership position in the newly combined, publicly traded entity.

An affiliate of Stonepeak, a leading alternative investment firm, has provided a debt and equity financing commitment to Akumin in connection with the acquisition. "We are thrilled to partner with Akumin in this transformative transaction in an effort to help accelerate the company's growth in the years ahead," said James Wyper, Senior Managing Director at Stonepeak. "We believe the combined company is well positioned to deliver high-quality, efficient, tech-enabled and patient-centric solutions through its ownership and operation of radiology and oncology infrastructure critical to the healthcare industry."