Civitas Solutions, a home- and community-based healthcare services provider based in Boston, is considering a potential sale and strategic alternatives, according to Reuters, which cited people familiar with the matter. The provider is reportedly working with an investment bank in exploration of a sale.
The potential interest in Civitas underscores the rising profile of post-acute care providers in the healthcare market as the broader system continues to shift toward value-based care. Earlier this year, health insurance provider Humana completed two multibillion-dollar deals to acquire a 40 percent is stake in both Kindred at Home––the home healthcare branch of Kindred Healthcare––and Curo Health Services, a hospice provider.
Civitas has garnered interest from private equity firms in the sector, which have ramped up acquisitions in the space over the last several years. Another home care services provider owned by private equity firm Onex Corp, BrightSpring Health Services, received preliminary buyout offers last week from interested buyers, according to Reuters.
Civitas is partially owned by Vestar Capital Partners, a middle-market private equity firm in New York, which acquired the home care provider in 2006. Civitas reported net revenue of $404.5 million during the third quarter of 2018. Upon news of the rumored buyout, the company’s stock price jumped about 13 percent on Friday, Reuters reported. Shares hovered at nearly $16 as of Monday mid-day trading.
Deliberations are in the early stages and “no deal is certain,” Reuters reported. Vestar, which owns more than half of Civitas, would seek to cash out its stake in a deal, Retuers’ sources stated.
Civitas operates in 36 states and employs roughly 23,000 people. Civitas declined to comment, noting the company does not comment on market rumors or speculation regarding potential transactions in an email to Health Exec.