Louisville, Kentucky-based BrightSpring Health Services Inc. (NASDAQ: BTSG) announced Tuesday it completed the sale of its ResCare Community Living division to Sevita.
The $835 million sale, first announced approximately 14 months ago, encountered a setback during regulatory review. In February, the companies reached an agreement with the Federal Trade Commission (FTC) to sell 128 intermediate care facilities to another regional operator, the Dungarvin Group, in several metros in Indiana, Texas and Louisiana to resolve concerns that Brightspring’s sale of ResCare Community Living to Sevita would reduce competition and consumer choice.
“The divestiture of our Community Living business was not a decision made lightly and was guided by our priority of ensuring continued high-quality, innovative care for clients,” BrightSpring CEO and President Jon Rousseau said in a statement.
BrightSpring’s provider services now include home health care, personal care and “rehab therapy” services.
“Expanding our footprint and welcoming ResCare Community Living will allow us to utilize the strengths of both organizations, enhance our programming, and reach even more people in need of high-quality services and support,” Philip Kaufman, CEO of Sevita, said in a statement. “We are confident that we can be better together and continue to innovate service delivery as our field evolves to enhance the lives of the individuals we are honored to support.”
Industry experts said the fact that the deal went through even with the hang-up during the federal review is a sign that dealmakers can take steps to address concerns that consolidation may negatively impact patients. During the Biden administration, experts said, deals with anticompetitive concerns were much less likely to be allowed to go forward.
The deal also highlighted to some that deals with any overlap need to be handled very thoroughly and anticipate worst-case scenarios.