Birmingham-based Encompass Health Corporation is rebranding the Dallas-based home health and hospice business it acquired in 2014, which will soon be known as Enhabit Home Health Care and Hospice.
The home health and hospice business is being converted into a new publicly-traded company separate from the corporation’s inpatient rehabilitation business.
The Encompass home and health hospice business was founded in 1988 by April Anthony. The business grew into one of the most recognized providers of Medicare-certified services in the U.S.
The company has been rated as one of the top places to work in the Dallas-Fort Worth area. Anthony sold the company to encompass in 2014 for $750 million in cash and rollover equity.
According to The Dallas Morning News, Encompass said that Enhabit Home Health & Hospice would base its operations from Dallas and run 251 home health and 96 hospice agencies in 42 states and Puerto Rico. It will operate with 11,000 employees.
The inpatient rehabilitation sector of the business is considered the higher-growth part of the corporation. With the move, shareholders will own stock in both companies.
Bloomberg Intelligence healthcare analyst Glen Losev said that Encompass’ home health care business revenue could grow by about 52% in three years.
Losev also said that the spinoff was agreed upon due to the lack of buyers willing to pay “a premium for Encompass’ unit. Based on recent home-health and hospice acquisition multiples, we calculate Encompass’ unit is worth up to $1 billion,” he said.
Encompass said that the spinoff’s name is drawn from the word ‘inhabit,’ which is intuitively linked to the home.
The rebranding to Enhabit is expected to begin in mid-April, while the division will be completed by the end of June.