Just two months after becoming a public company, American Addiction Centers (AAC) has entered into an agreement to acquire Recovery First, a Florida-based provider of substance abuse treatment and rehabilitation services, for $13 million in cash. Chairman and CEO Michael Cartwright had indicated during the company’s third-quarter investors’ report that AAC was looking for strategic acquisitions.
The Recovery First deal will add a 56-bed inpatient treatment facility, including 20 licensed detoxification beds, to AAC’s six existing facilities. As of September 30, 2014, Recovery First generated revenue of approximately $7.3 million.
“American Addiction Centers’ multi-faceted growth strategy is built on executing an active pipeline of de novo opportunities and acquiring complementary treatment facilities that provide additional beds for both out-of-network and in-network admissions as well as extend our outpatient center network,” said Cartwright in a press release. “Our management team has a long history of operating in Florida with two existing facilities and another under construction, and [Recovery First CEO] James F. Davis and his staff share the passion we have for treating those dealing with addiction. The addition of Recovery First’s facilities and its in-network agreements to our nationwide sales and marketing platform should enable us to broaden the range of clients we serve and drive increased performance across these facilities.”
Recovery First accepts commercial insurance coverage from several major carriers, which fits with AAC’s current model. It also offers partial hospitalization, outpatient, day/night programs, relapse treatment and sober living.