Acadia Healthcare has signed a definitive agreement to purchase Priory Group in the United Kingdom for $2.2 billion, adding to its portfolio more than 300 facilities with 7,200 beds. With the deal, Acadia now holds 54 inpatient facilities in the U.K. with 2,200 beds.
According to the announcement, Acadia will pay cash consideration of approximately $1.887 billion, including $1.369 billion to repay outstanding debt. For 2015, Priory is expected to produce revenue close to $865 million.
Just a month ago, Acadia acquired MMO Behavioral Health Systems, based in Louisiana, closely following a period of significant activity in third quarter 2015, in which the organization announced acquisitions of eight inpatient facilities with an aggregate of more than 300 beds.
Priory treats 70 different conditions within its four divisions—healthcare, education and children’s services, adult care and senior care—providing care for 30,000 people every year.
The Priory Group was created in 1980 with the purchase of the Priory Hospital by a U.S. healthcare company. The Roehampton site has been in continuous operation since its launch in 1872.
It is expected that Acadia will seek a combination of equity and long-term debt financing to finance the transaction, which it expects to complete by February 16, 2016.
“We believe the favorable industry dynamics that support this strategy—in particular, a long-term increase in the need for independent sector support for inpatient behavioral health—will provide Acadia continuing long-term accretive organic growth and acquisition opportunities,” said Joey Jacobs, chairman and CEO, in a statement.