Telehealth player Patient Home Monitoring rises on acquisition of Sleep Management

Shares of Patient Home Monitoring (Patient Home Monitoring Stock Quote, Chart, News: TSXV:PHM) are up today after the company announced the acquisition of Louisiana-based Sleep Management, a company that provides ventilators to heart patients in 19 states.

Patient Home Monitoring says it will pay $36-million in cash and 42.75 million shares, which at current prices would bring the total consideration to just over $100-million.

“We wanted to focus on closing our largest deal first,” said chairman Michael Dalsin. “When you take into consideration the size of this company, in terms of patients, geographical spread, growing revenues and significant profits, we have doubled the run-rate profitability of Patient Home Monitoring overnight with this transaction. It gives Patient Home Monitoring immediate access to more than a dozen new states to start cross-sell[ing] additional services. Additionally, we have two more LOIs [letters of intent] we are working to close with combined trailing 12-month revenues of $35-million, along with several smaller deals that have combined revenues of $15-million.”

Patient Home Monitoring says the combined operations will boast an annualized run-rate revenue to exceed $115-million and adjusted EBITDA to exceed $30-million.

RNCOS Business Consultancy Services says the telehealth sector will grow at an 18.5% clip over the next several years.

At press time, shares of PHM were up 7.6% to $1.56.

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