Help At Home queuing up for sale, but launch may be delayed due to COVID-19, sources say

13 March 2020

Help At Home, a Wellspring Capital-backed homecare provider, is gearing up for a sale process, said four sources familiar with the matter.
The Chicago-based company held a bakeoff in late 2019 and was set to launch a process later this year or early next, two sources said. However, the company may delay its launch in light of the global spread of the novel coronavirus and market volatility. It is unclear whether a bank has yet been mandated.
Help At Home will be marketed off around USD 125m in adjusted EBITDA, two sources said. The company is likely to fetch a low double-digit multiple in the event of a sale, said one source, noting comps include One Equity-owned Simplura, which is also currently up for sale, this news service has reported.
Addus HomeCare [NASDAQ:ADUS], which is currently trading at around 26x its EBITDA of USD 42m, is another comparable for Help At Home, said another source.
Help At Home provides non-medical homecare, such as feeding, cleaning and other personal care services, as well as home health and community living services. The company has presence across 13 states, with 155 locations and 28,000 caregivers, according to a press release.
WellSpring acquired the company in 2015 for an undisclosed price. At the time of sale, Help At Home generated around USD 45m, this news service reported.
In February, Help At Home announced the acquisition of Coastal Home Care and Altrus, two Georgia-based companies serving elderly and disabled people.
The home health industry saw new regulations handed down in January, when the Centers for Medicaid and Medicare Services implemented its Patient-Driven Groupings Model (PDGM). PDGM cuts payment periods from 60 to 30 days, and takes therapy volume out of consideration when determining home health agency payments. Instead, the agency is applying a value-based care model designed to thwart excessive fees.
The new regime is expected to have an impact on M&A in the space, with smaller home health and hospice operators looking for quick exits, this news service has reported. Larger-scale providers, particularly those that also provide non-skilled medical care, are likely to be more insulated from reimbursement pressures, according to previous Mergermarket reports.
Help At Home and Wellspring did not respond to requests for comment.

by Claire Rychlewski in Chicago and Bhavna Kaul and Dane Hamilton in New York 

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