SOURCE: AdCare Health System, Inc.

AdCare Health System, Inc.

August 19, 2011 08:31 ET

AdCare Health Systems to Acquire Skilled Nursing and Assisted Living Center in Ohio for $13.5 Million

AdCare Annualized Run-Rate Expected to Top $280 Million, up 426%+ Over FY2010

SPRINGFIELD, OH--(Marketwire - Aug 19, 2011) - AdCare Health Systems, Inc. (NYSE Amex: ADK), a leading provider of skilled nursing and assisted living, has signed a definitive agreement to purchase a skilled nursing and assisted living community in Ohio for $13.5 million.

The community has 193 beds, and generates an estimated $12 million in gross annualized revenues according to its most recent financials. After the transaction closes as planned before the end of the year, AdCare expects the facilities to be immediately accretive to its earnings.

AdCare plans to finance the acquisition of the assisted living facility with a 30-year, fixed-rated, tax-exempt bond issuance, and finance the skilled nursing facility with a traditional bank loan.

With this transaction, AdCare has now put under contract 44 facilities since its M&A campaign began in the fall of 2009, representing more than 4,890 beds.

Combining AdCare's current annualized run-rate with transactions currently in the process of closing, the company's estimated annualized revenue run-rate is expected to exceed $280 million. This would represent an increase of more than 426% over the company's revenues in 2010, and an increase of more than 949% over revenues in 2009 when it initiated the current M&A campaign.

"Since establishing new operations in Alabama, Georgia and North Carolina, we've now made our first acquisition in the state of our origins," said Chris Brogdon, AdCare's vice chairman and chief acquisitions officer. "These new facilities will leverage the professional support staff we've long maintained in Ohio, as well as enhance our overall economies of scale."

"We're continuing to evaluate a number of attractive opportunities in the Midwest and South," added Brogdon, "with our M&A program and the integration of new facilities remaining our primary corporate focus going forward."

According to Boyd P. Gentry, AdCare's president and chief executive officer: "Our strategy of acquiring skilled nursing facilities is proving highly successful, not only in our closing rate and terms, but also in our post-acquisition performance. We have been targeting facilities that have not traditionally concentrated on providing post-acute services, and then once acquired, we optimize patient care, occupancy and quality mix."

About AdCare Health Systems
AdCare Health Systems, Inc. (NYSE Amex: ADK) is a recognized innovator in senior living and health care facility management. AdCare develops, owns and manages assisted living facilities, nursing homes and retirement communities, as well as provides home health care services. Since its inception in 1988, AdCare's mission has been to provide the highest quality of healthcare services to the elderly. For more information about AdCare, visit

Important Cautions Regarding Forward-Looking Statements
Statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of federal law. Such statements can be identified by the use of forward-looking terminology, such as "believes," "expects, " "plans," "intends," "anticipates" and variations of such words or similar expressions, but their absence does not mean that the statement is not forward-looking. Statements in this announcement that are forward-looking include, but are not limited to, statements that the company expects its annualized revenue run-rate to exceed an estimated $280 million, as well as statements regarding the signing and expected closing of transactions and transactions being accretive to the company's earnings. Such forward-looking statements reflect management's beliefs and assumptions and are based on information currently available to management, and involve known and unknown risks, results, performance or achievements of AdCare which may differ materially from those expressed or implied in such statements. Such factors are identified in the public filings made by AdCare with the SEC and include, among others, AdCare's ability to secure lines of credit and/or an acquisition credit facility, find suitable acquisition properties at favorable terms, changes in the health care industry because of political and economic influences, changes in regulations governing the industry, changes in reimbursement levels including those under the Medicare and Medicaid programs and changes in the competitive marketplace. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements. Except where required by law, AdCare undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.

Contact Information

  • Company Contacts
    Boyd Gentry
    Chris Brogdon
    Vice Chairman & CAO
    David A. Tenwick
    Chairman of Board
    AdCare Health Systems, Inc.
    Tel (937) 964-8974
    Email Contact

    Investor Relations
    Ron Both or Geoffrey Plank
    Liolios Group, Inc.
    Tel (949) 574-3860
    Email Contact