BrightSpring divests community living business for $835M; raises FY24 revenue outlook

BrightSpring Health Services (NASDAQ:BTSG) has entered into a definitive agreement to divest its Community Living business, namely ResCare Community Living, to Sevita for $835M in cash consideration; raises full year financial results above the guidance and initiates 2025 guidance excluding Community Living.

The transaction, expected to close in 2025, will generate approximately $715 million in after-tax proceeds, primarily used for debt reduction, which further strengthens the company’s balance sheet and reduces interest expense.

The divested Community Living business is projected to generate about $1.2 billion in Revenue and $128 million in Adjusted EBITDA for 2024, with approximately $23 million of capital expenditures and capital leases.

After the divestiture, BrightSpring’s Provider Services will comprise Home Health and Hospice, Personal Care, Rehabilitation Services, and Primary Care. 

The transaction is expected to be accretive to both company and provider services revenue growth and adjusted EBITDA growth.

Furthermore, the company reported preliminary 2024 results above previous guidance, with expected Net Revenue of $11.2B-11.3B vs. consensus of $11.17B and Adjusted EBITDA of approximately $588M. For 2025, excluding Community Living, BrightSpring projects a Net Revenue of $11.5B-12.0B vs. consensus of $12.39B and Adjusted EBITDA of $540M-555M.