Home health and hospice provider Enhabit disclosed on Wednesday that it has completed its strategic review process and has decided to remain an “independent, public” company.
While the company and its advisers ran a thorough strategic review process that concentrated on a merger or acquisition of the firm, it did not receive any formal proposals for a transaction.
“We believe macro headwinds including, among other things, uncertain regulatory developments including Medicare reimbursement policies throughout the healthcare industry and an evolving antitrust landscape, a difficult healthcare operating environment, and persistently high interest rates ultimately stifled possibilities for a transaction that would enhance shareholder value,” Chairperson of the Board Leo Higdon said in a statement. “Considering this, and other strategic alternatives reviewed with advisers during the review process, the board determined the best way to enhance shareholder value at this time is to continue to operate as a stand-alone business.”
The disclosure came on the same day that the company disclosed its 2024 first quarter earnings. The company earned an adjusted EBITDA of $25.3 million, the same amount it earned in the year-ago quarter. Total net service revenue totaled $262.4 million, a 1% decrease from the first quarter of 2023.
“Our strong start to 2024 is a result of our team’s continued focus on our operational strategies,” Enhabit President and Chief Executive Officer Barb Jacobsmeyer, said in a statement. “Additional frontline clinicians, more and better home health payer contracts and controlling general and administrative expenses were the key drivers of our performance in the first quarter and resulted in sustained consolidated Adjusted EBITDA of $25.3 million in both the first quarter of 2024 and 2023. We are confident we are taking the right steps to drive future growth.”
Last June, an investor urged the company to sell itself based on its declining stock price. Then in August, the company disclosed it was initiating a strategic review and seeking strategic alternatives in the form of a merger, sale, acquisition or other transaction.
