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Corporate News Blog - AAC Holdings to Open New Detoxification Unit in New Orleans East Hospital; Set to Add 36 Beds to its Portfolio

LONDON, UK / ACCESSWIRE / October 2, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for AAC Holdings, Inc. (NYSE: AAC), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=AAC. The Company announced on September 29, 2017, that it has received licensure for its new Townsend Recovery Center New Orleans in New Orleans, Louisiana. The 36-bed facility has been leased from the New Orleans East Hospital and is scheduled to open on October 09, 2017. The facility, located on the 5th floor of Townsend Recovery Centre New Orleans has 36 beds, provides detoxification and residential treatment services, and will be operated by the Townsend clinical staff. American Addiction Centers (AAC) Holdings is a leading provider of inpatient and outpatient substance abuse treatment services. For immediate access to our complimentary reports, including today's coverage, register for free now at:


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The Announcement

AAC Holdings views this agreement as a step to fill a critical community need, by offering a long-term recovery. The additional beds would enable the Company to support Townsend Treatment Centers and Townsend Outpatient Center along with other treatment providers in Louisiana. The New Orleans East Hospital is an 80-bed site located on the site of the former Pendleton Memorial Hospital that was destroyed by the hurricane, Katrina, in 2005.

Townsend is a part of the Company's treatment center portfolio and is a leading provider of treatment services in south Louisiana and is known for its treatment model, named The Townsend Way. The personalized approach includes addressing the genetic components of the addiction and utilizing pharmacogenetics to offer physicians with vital information about which medications would be the most beneficial for each patient.

The AdCare Acquisition

Prior to the announcement, on September 13, 2017, AAC Holdings announced that it entered into a definitive agreement to acquire AdCare, Inc., and its affiliated and associated real estate assets for a total consideration of $85 million. Through this acquisition, AAC Holdings intended to accelerate its longstanding plan to diversify into government pay, hence leveraging an existing outpatient and business development presence in New England and would continue to expand on its hospital strategy.

AdCare, founded in 1986, is a leading provider of addiction treatment in New England with over 6,000 hospitals and residential admission with over 115,000 outpatient visits every year. AdCare generated revenues of $51 million for the 12-month period ended June 30, 2017, with adjusted EBITDA of $8.5 million. Its revenues during the period were 59% related to Medical reimbursement, 19% from Medicaid reimbursement, and 22% from in-network contracts. The transaction was anticipated to close in H1 2018 and was expected to be financed through a combination of proceeds from the issuance of an incremental term loan under the Company's senior secured loan facility cash on hand, and seller-financing, and $5 million of restricted shares of the Company's common stock.

Company Growth Prospects

On August 07, 2017, AAC Holdings announced that it had signed a definitive agreement to sell its two standalone outpatient facilities and two sober living facilities in the US for $25 million in cash to MedEquities Realty Trust (NYSE:MRT). The Company, concurrently, with the sale, leased the facilities from MedEquities pursuant to a 15-year triple-net lease at an initial lease rate of 8.75%. The Company intended to deploy the proceeds to pay down borrowings under its revolving credit facility and fund its de novo activities.

Last Close Stock Review

On Friday, September 29, 2017, the stock closed the trading session at $9.93, falling 3.03% from its previous closing price of $10.24. A total volume of 79.32 thousand shares have exchanged hands. AAC Holdings' stock price skyrocketed 7.82% in the last one month, 43.29% in the past three months, and 16.41% in the previous six months. Furthermore, since the start of the year, shares of the Company have soared 37.15%. The stock currently has a market cap of $246.36 million.

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