Blue Wolf Capital Partners was making major investments in the home health care sector. The private equity fund had purchased two U.S. regional companies in the space – NHHC (National Home Health Care Corporation), announced in November 2015, and GLC (Great Lakes Caring Home Health and Hospice), announced in May 2016, with an investment reported as $104 million. The plan was to merge the two organizations, creating opportunities for shared expertise and synergies in reducing management costs.
Two years later, the management team was considering adding a third company, Jordan Health Services, into the group. Adding Jordan Health Services into the merger of Great Lakes Caring Home Health and Hospice (GLC), National Home Health Care (NHHC) would create the fourth-largest continuum-based homecare company in the United States. With over 31,000 caregivers across 15 states in 221 locations, the newly formed company would serve more than 63,000 individuals and families daily. Projected revenues for the combined organization would top $1 billion annually.
The Blue Wolf research team had provided extensive analysis to allow the Investment Committee to evaluate the potential benefits and risks of the purchase. The team described the many benefits of the purchase, but recognized that merger success posed many challenges. What was the likelihood that this opportunity would succeed? Would Blue Wolf be better served instead by focusing on its earlier purchases and the potential for synergies and organic growth within the existing firms? Should the Investment Committee give the go-ahead to the purchase of Jordan Health? <
Publication Date: March 13, 2020
Citation: Jean Rosenthal, Jaan Elias, Adam Blumenthal, and Jeremy Kogler, "Home Health Care," Yale SOM Case 20-012, March 13, 2020.