The Federal Trade Commission has done it again. The agency closed its investigation into the merger of Aveanna Healthcare with Maxim Healthcare‘s home health division, announced in February 2019.
We’re accustomed to seeing headlines every few months saying the FTC plans to tighten scrutiny of hospital mergers and acquisitions. The anti-trust division has been active in the hospital sector, the majority of announced hospital mergers more often collapse under their own, unique conditions.
Just last year, Care New England ended merger talks with Lifespan and Brown University, after seeing its merger with Boston’s Partners HealthCare shot down by Rhode Island’s governor. Two Texas healthcare behemoths, Baylor Scott & White Health and Memorial Hermann Health System, began and ended discussions four months after signing a letter of intent. In November, the California Attorney General denied the proposed transaction between Adventist Health and St. Joseph Health. And those are just the biggest ones.
It’s not as often we see action taken in the Home Health & Hospice sector, however. In this case, Aveanna and Maxim called off the proposed merger of Maxim’s home healthcare division with Aveanna in response to the FTC’s “concerns about the transaction’s potential anti-competitive effects.”
Atlanta-based Aveanna is a portfolio company of Bain Capital and J.H. Whitney Capital Partners and is the largest pediatric home healthcare company in the United States. It was formed by the merger of Epic Health Services and PSA Healthcare in March 2017.
Maxim’s home healthcare division, based outside Baltimore in Columbia, Maryland, provides skilled nurses, therapists and home health aides in the adult, senior and pediatric home healthcare arena. Its staffing services and population health and wellness divisions were not part of the agreement.
No financial terms were disclosed at the time of the announcement in February 2019, but sources later reported the deal was valued at $1.2 billion.
Aveanna was under investigation for safety violations and even pediatric deaths, according to an October report by Bloomberg News.
Aveanna did succeed in one deal, acquiring California pediatric home care provider Premier Healthcare Services in 2018. Premier provides pediatric services to patients in California, with additional operations in Colorado and Texas. It offers home health services as well as behavioral health benefit administration services. No price was disclosed with the March 2018 announcement.
