Home health giant Amedisys and Option Care Health Inc., a major provider of home and alternate site infusion services, have entered into a definitive merger agreement to combine in an all-stock transaction that values Amedisys at approximately $3.6 billion, including the assumption of net debt, the companies disclosed late Wednesday.

Under the terms of the agreement, Amedisys stockholders will receive 3.0213 shares of Option Care Health common stock for each share of Amedisys common stock they hold at the closing of the transaction, the equivalent of $97.38 per Amedisys share based on Option Care Health’s closing stock price on May 2, 2023.

“This transaction unites two leading and complementary companies to provide unsurpassed care and superior clinical outcomes to patients,” said John C. Rademacher, president and chief executive officer of Option Care Health, in a statement. “Our mission is to transform healthcare by providing innovative services that improve outcomes, reduce costs, and deliver hope and dignity for patients and their families. With the addition of Amedisys, we will bolster our offerings to meet the growing demand for personalized care in the home and alternative sites that move us closer to achieving this goal.”

Under the new company, Rademacher will be the CEO. Amedisys President and CEO Richard Ashworth, who only took the reins of Amedisys in March, will serve in a special adviser role. The transaction is expected to close in the second half of 2023.

“This combination is a testament to the incredible work and quality outcomes Amedisys delivers on a daily basis for our patients wherever they call home,” Ashworth said in a statement. “Bringing together Option Care Health and Amedisys is an exciting next step on our journey and one that we believe will deliver significant value to stockholders, allowing them to participate in the upside of a combined company that is well positioned in the home infusion and growing home health, hospice, palliative and high-acuity care spaces.”

The news of the merger occurred on the same day as the release of Amedisys’ first quarter earnings. For the quarter ended March 31, Amedisys earned $24.9 million, a decrease of 21.4% compared to the year-earlier quarter. Net service revenues rose by a slight 2% to $556.4 million.

Together, Option Care Health and Amedisys will have a national clinical workforce of more than 16,500 professionals including nursing professionals; pharmacists; pharmacy technicians; dietitians; physical, occupational and speech therapists; social workers and aides, and 674 care centers across the United States, the companies said. The combined company will have a scaled national platform empowered to move deeper into a value-based care model, serving communities across the country and helping to benefit patients and their families, providers, payers and care teams.

During a call explaining the merger to investors, Option Care Health executives talked about the synergies between the two companies. Both companies focus on the patient, strong clinical outcomes and high quality, Rademacher said.

“We are going to look and optimize the footprint and serve patients where they want to be met,” Rademacher said. “This will give us an additional opportunity to evaluate and understand where we can expand and meet greater patient need.”

The two companies started to partner during Operation Warp Speed during the pandemic, said Mike Shapiro, chief financial officer of Option Care Health. The relationship deepened over the past six months as the firm worked with Contessa, the hospital-at-home division of Amedisys.

“There’s a lot of things to get excited about around leveraging the complementary assets,” he said. “We just realized there are more and more areas for collaboration.”

This is a developing story. Please check back for updates.

This article originally appeared on McKnight's Long-Term Care News