AeroCare Holdings Inc., a portfolio company of private equity firm Ferrer Freeman & Co., has agreed to a merger as a way to become a publicly-held company.
The Orlando, Florida-based company is combining with MergeWorthRx Corp. (Nasdaq: MWRX), a holding company focused on health care services, in an all-stock transaction.
AeroCare, a provider of home respiratory and sleep-therapy services, has been looking to expand. By going public, the company expects to use the capital raised to expand via M&A.
AeroCare has already grown considerably through dealmaking. It acquired 23 companies in 2013, representing roughly $43 million in total revenue. In total, AeroCare generated $150 million in revenue for 2013. The company currently operates out of 106 locations across 15 states.
Once the deal is completed, MergeWorthRx's co-founder Stephen Cichy will join AeroCare chief Steve Griggs and Ferrer Freeman partner Ted Lundberg on the board of directors.
Under the terms of the agreement, MergeWorthRx will issue 11.3 million new shares and 0.5 million options to existing AeroCare stockholders once the deal closes. AeroCare's existing stockholders will then own 53 percent of the post-merger company and have the right to receive up to $30 million of additional shares of MergeWorthRx common stock, at a price of $8.36 per share.
New York-based EarlyBirdCapital Inc. brokered the deal while McDermot Will & Emery LLP served as legal counsel to MergeWorthRx. Cain Brothers & Co. LLC advised AeroCare on the deal while law firm Goodwin Procter LLP handled legal matters.
AeroCare is also a portfolio company of MTS Health Partners, a private merchant bank that partners with private equity firms.