Cross Country Healthcare To Acquire Assets of Medical Staffing Network
Cross Country Healthcare, Inc.
Cross Country Healthcare, Inc. (NASDAQ:CCRN), a leading provider of healthcare staffing solutions, announced today that it has signed a definitive agreement to acquire substantially all of the assets and business of Medical Staffing Network (“MSN”) and assume substantially all of the liabilities of MSN for an aggregate purchase price of $48.3 million, subject to a post-closing working capital adjustment.
MSN is a comprehensive healthcare staffing company which has 55 locations throughout the U.S. that provide per diem, local, contract, travel, and permanent hire staffing services. For the year ended December 31, 2013 and the four-month period ended April 30, 2014, MSN had unaudited revenues of $229 million and $78 million, respectively.
Cross Country Healthcare President and CEO William J. Grubbs said, “The acquisition of MSN’s assets represents a strategically compelling opportunity for Cross Country Healthcare, accelerating our expansion plans by several years, increasing our market share and bringing us new products and opportunities to cross-sell to all of our customers. From a financial perspective, we expect this transaction to create significant value for our shareholders and meaningful earnings accretion in 2015 through increased scale, accelerated growth opportunities, and cost synergies.”
The transaction is expected to be dilutive to earnings per share by $0.10 - $0.12 for 2014, primarily due to acquisition and integration related charges; and accretive to 2015 earnings per share by $0.12 - $0.15. These estimates are subject to assumptions regarding the timing of the closing of the deal, the attainment of synergies, as well as the company’s tax rates and the finalization of purchase accounting.
The Company has entered into commitments for subordinated debt consisting of a $30 million, 5-year variable rate term loan and $25 million of convertible notes having a 6-year maturity. The combined effective interest rate for the subordinated indebtedness is expected to be 7.72% for 2014. Cross Country Healthcare also has a commitment from its current lender, Bank of America. N.A. to increase its borrowing capacity under its senior secured asset-based revolving credit facility from $65 million to $85 million.
Consummation of the transaction is subject to customary closing conditions. It is anticipated that the Closing will occur before the end of June 2014.
Foros LLC served as financial advisor to Cross Country Healthcare for the acquisition and Proskauer Rose LLP served as its legal advisor.
INVITATION TO CONFERENCE CALL
Cross Country Healthcare will hold a conference call on June 3, 2014 at 9:00 am ET to discuss this transaction. This call will be webcast live and can be accessed at the Company's website at or by dialing 800-857-6331 from anywhere in the U.S. or by dialing 1-517-623-4781 from non-U.S. locations - Passcode: Cross Country. A replay of the webcast will be available at the Company's website and a replay of the conference call will be available by telephone by calling 800-695-4244 from anywhere in the U.S. or 402-220-0321 from non-U.S. locations - Passcode: 2014.
ABOUT CROSS COUNTRY HEALTHCARE
Cross Country Healthcare, Inc., headquartered in Boca Raton, Florida, is a national leader in providing healthcare staffing and workforce management solutions. Our traditional staffing includes temporary and permanent placement of travel nurses and allied professionals, branch-based local nurses and allied staffing, and locum tenens physicians. We provide flexible workforce management solutions to the healthcare market through diversified offerings, meeting the special needs of each client. In addition to traditional staffing, we offer managed service programs (MSP), workforce assessments, internal resource pool consulting and development, electronic medical record (EMR) transition staffing, and recruitment process outsourcing services. We have approximately 3,000 active contracts with government and commercial hospitals and healthcare facilities, and other healthcare organizations throughout the U.S. to provide our staffing services and workforce solutions. We also provide physician and executive search services as well as education and training programs for healthcare professionals. Cross Country Healthcare employs approximately 1,100 corporate employees and utilizes on average 2,420 field employees and 1,640 independent contractors.
ABOUT MEDICAL STAFFING NETWORK
Medical Staffing Network is one of the largest and most recognized and that balance quality patient care with cost-savings. With more than 30 years of experience, MSN’s offerings streamline and optimize the patient care continuum from recruitment and onboarding to intake and case management. As a comprehensive healthcare staffing company, MSN provides nursing, allied healthcare, pharmacy, clinical research, anesthesia, advanced practice and case management professionals through a network of 60+ locations and traveler solutions.
Copies of this and other news releases as well as additional information about Cross Country Healthcare can be obtained online at . Shareholders and prospective investors can also register to automatically receive the Company's press releases, SEC filings and other notices by e-mail.