An organization with a history of investments in the energy-services industry is making a significant shift toward investment in behavioral health treatment centers. Alanco Technologies has created a behavioral health subsidiary and hired David C. Johnson—a former treatment center executive and consultant—to lead it.
“There are more advantages to investing in industries that are in a growth mode,” Johnson tells Behavioral Healthcare. “Technically right now, we’re doing both energy and behavioral health.”
He says Alanco is in the process of acquiring three traditional residential treatment centers with each deal in various stages of development. The goal is to consolidate and streamline the portfolio not just for the sake of economies of scale but also for clinical best practices and daily operations.
“We anticipate one deal closing in the third quarter of this year, another in the fourth quarter, and the third one is still unknown but hopefully will close in the fourth quarter as well,” Johnson says.
A former Hazelden Betty Ford leader, Johnson also founded Peak Consulting Partners and helped to facilitate $50 million in merger and acquisition deals in the market.
“In the future as private equity floods the marketplace, it will be harder for the small 20- or 25-bed treatment center to compete on a national scale,” he says. “They get crushed by humungous consolidation and large corporate entities from a marketing and operations standpoint. I can’t tell you how many clients I’ve talked to who are struggling because of the consolidation with no way to compete.”
Alanco (OTCQB: ALAN) is a public company traded on an SEC-registered Alternative Trading System known as the OTCQB Venture Marketplace. It’s for entrepreneurial and development stage companies that are current in their reporting and have an annual verification and management certification process.
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