Radiology provider Akumin forms ‘powerhouse,’ closing $820M purchase of Alliance Healthcare Services
Publicly traded radiology group Akumin Inc. has closed its $820 million deal to purchase Alliance Healthcare Services, company officials announced Wednesday afternoon.
First proposed in June, the blockbuster deal expands the Plantation, Florida, imaging center operator vertically into oncology solutions, imaging joint ventures, and advising others on acquisitions. The combined company will operate in 46 states, serving 1,000 hospital and health system customers, operating 154 outpatient imaging locations, and 34 more in radiation therapy.
“When we announced our acquisition of Alliance and the plan to bring these two great companies together, we shared our belief that this combination is very exciting in the context of a changing healthcare ecosystem—continuing not only to shift toward outpatient, price-transparent, value-based care, but also toward increasingly integrated hospitals, health systems and physician groups,” Akumin Chairman and Co-CEO Riadh Zine said in a Sept. 1 statement. “Today, we celebrate our first steps together as a powerhouse in outpatient healthcare solutions, and a catalyst for continued healthcare transformation in the U.S.”
Akumin is funding the deal through various sources, including cash on hand, new debt, and issuing equity to previous Alliance owner Tahoe Investment Group, which will hold a spot on its board. In addition, the financing firm Stonepeak on Wednesday purchased $340 million of Akumin’s unsecured notes, along with $10 million worth of common shares in the company (at $2.98 apiece). For the next three years, Akumin said it will be able to draw an additional nearly $350 million from Stonepeak, according to the announcement.
Rhonda Longmore-Grund—former CEO of Irvine, California-based Alliance—will stay on as president and co-chief executive following the closing. Both leaders will remain “actively involved” in running the combined company, expected to generate $730 million in revenue and $213 million in adjusted earnings.
“As one company, we will expand our solutions to hospital customers and partners with a focus on driving access, efficiency and innovation,” Longmore-Grund added in the announcement. “We begin our integration today—and look forward to sharing our progress, successes and growth.”
The radiology provider has been on a buying binge this year, acquiring a 34% stake in an artificial intelligence firm for $4.6 million and six freestanding imaging centers for $39 million. Akumin also made headlines in August when it was forced to postpone its second quarter earnings call after missing a key filing deadline.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.