Three of the executives who helped build a $1 billion, publicly traded social services provider have launched a home health company with backing from Nashville money and advice.
Leading Arizona-based Sinfonia Healthcare are Fletcher McCusker and Michael Deitch, the former CEO and CFO, respectively, of Providence Service Corp. Both men left Providence (Ticker: PRSC) at the end of 2012 and have since secured a total of $20 million in debt from Petra Capital and Alliance Bank of Arizona. Along with former Providence IT exec Jeff Pochily, they also have signed letters of intent to buy four home health providers in the Tucson market, deals on which they were advised by downtown-based Jeff Nahley of Signal Hill Capital.
With Sinfonia, McCusker and his team are looking to roll up parts of the $90 billion home health care sector, which is expected to boom because of changes and new incentives stemming from the Affordable Care Act. The executives say Sinfonia is designed to grow to include hospice, skilled nursing, physical therapy, speech therapy and other services.
"Most providers of home health are organized vertically, providing just one type of service," said McCusker in a statement. "No one is approaching home health in an effort to operate the full continuum of care. We believe this creates a great opportunity for consolidation in a very fragmented industry."
Nahley, who helped launch Providence in 1997, is likely to be busy with Sinfonia in the coming months: The company is hunting for more deals in New Mexico, Florida and California.