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Bioscrip (BIOS) To Buy Davita Healthcare's (DVA) Unit Homechoice Partners

 December 13, 2012 09:19 AM

(By Balaseshan) BioScrip Inc. (NASDAQ: BIOS) said it has agreed to buy HomeChoice Partners Inc., a majority-owned subsidiary of DaVita HealthCare Partners Inc. (NYSE: DVA), for $70 million in cash.

The purchase price is subject to adjustment pursuant to the terms of the agreement including potential additional consideration based on the results of operations.

BioScrip also exBioScrippects to realize the value of a future tax benefit estimated at $3.9 million as a result of the transaction.

HomeChoice is expected to generate about $70 million in annual revenue. Once fully integrated, this business should generate Adjusted EBITDA margins of 12% to 14%. The company estimates that an acquisition of this size can take 9 to 12 months to fully integrate.

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"This transaction is also consistent with our stated goal of building our infusion business through strategic and opportunistic acquisitions, which meet our financial criteria and enable us to expand our national footprint," stated Rick Smith, Chief Executive of BioScrip.

HomeChoice, which is headquartered in Norfolk, Virginia, generates about $70 million in annual revenue, services approximately 15,000 patients annually and has fourteen infusion pharmacy locations in Pennsylvania, Washington DC, Maryland, Virginia, North Carolina, South Carolina, Georgia, Missouri, and Alabama.

The company expects the transaction will close in the first quarter of 2013.

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BioScrip is a provider of pharmacy and home health services, which partners with patients, physicians, hospitals, healthcare payors and pharmaceutical manufacturers to provide clinical management solutions and the delivery of prescription medications and home health services.

BIOS closed Wednesday's regular session down 1.92% at $10.71. The stock has been trading between $5.17 and $11.06 for the past 52 weeks.

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