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Apria jumps into hot market 

Apria jumps into hot market  How will it deploy new capital? 

LAKE FOREST, Calif. – After a lengthy period of relative quiet, Apria Healthcare’s planned IPO could signal a company that is ready to grow, say M&A analysts. 

The provider on Jan. 15 filed a Form S-1 with the Securities and Exchange Commission, a step it must take before filing an initial public offering. 

“They’ve been a bit conspicuous by their absence in doing transactions,” said Jonathan Sadock, managing partner/CEO of Paragon Ventures. “I think this has been brewing for a while, and I think the industry will be looking to see how they deploy that capital.” 

Apria was acquired by private equity firm Blackstone Group for $1.8 billion in 2008. Its biggest move since then: In 2013, it sold its home infusion business, Coram, to CVS Caremark for $2.1 billion. 

The IPO could also signal Blackstone’s need to monetize their investment, analysts say. Apria could have looked for a buyer, but there’s only a handful of companies that are large enough to buy them. 

“Blackstone has owned them for a very long time,” said Brad Smith, managing director/partner at Vertess. “With the market being very hot, they are probably going to see a huge return on investment.” 

The hot IPO market – for health care, in particular – has been further boosted by AdaptHealth, which ended a busy 2020 with a bang when it acquired AeroCare in a deal worth about $2 billion. 

“The market is up, then add on to that that AdaptHealth is well received and plays in the same marketplace – they all add up to, ‘Let’s give it a shot,’” said Pat Clifford, managing director, home medical equipment for the Braff Group. “I’ve heard estimates (Apria’s IPO could go as) high as $800 million but have not seen any (calculations). The underwriters will be as aggressive as they can.” 

When it comes to HME companies going public, the more the merrier, analysts say. 

“I would think that this just gives Adapt confidence now – they are going to see copycats,” said Don Davis, president of Durckridge Advisors. “Because of them, there’s a good M&A flow. It’s a good thing for them and good for their multiples.” 


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