Assure Holdings Completes Acquisition of Neuro-Pro Monitoring
Transformative Acquisition Strongly Reinforces Company’s Strategic Growth Plan
DENVER, Feb. 18, 2020 (GLOBE NEWSWIRE) -- Assure Holdings Corp. (the “Company” or “Assure”) (TSXV: IOM; OTCQB: ARHH), a provider of intraoperative neuromonitoring services (IONM), is pleased to announce that it has completed (the “Completed Agreement”) the previously announced acquisition (the “Acquisition”) of all of the assets of Neuro-Pro Monitoring (Neuro-Pro), one of the largest IONM service providers in Texas.
- Strengthens and Diversifies Revenue Stream with Substantial Increase in Number of Procedures
- Expanded Scale Expected to Facilitate Acceleration of In-Network Contracts with Insurance Companies
- Immediately Accretive to Earnings and Cash Flow in 2020
Assure acquired Neuro-Pro, one of the largest IONM companies serving the Dallas Ft. Worth metroplex. Neuro-Pro’s 13 technologists support 25 surgeons across 14 facilities. Neuro-Pro’s total number of procedures was 2,551 in 2019. Exclusive of Neuro-Pro, Assure’s total number of procedures in 2019 was 5,813. Historically, approximately 80% of Neuro-Pro’s procedures were commercial insurance payers while roughly 50% of Assure’s procedures are commercial payers. From a financial perspective, commercial insurance payers are more profitable procedures to Assure than procedures covered for patients with government insurance. When Assure reports fourth quarter and full-year 2019 results, 596 Neuro-Pro procedures and their associated financial impact, will now be included as these cases occurred after the acquisition agreement was announced on November 1, 2019.
John A. Farlinger, Assure’s executive chairman and CEO said, “This acquisition is truly transformative for Assure. It is consistent with our strategic plan to create scale by augmenting our organic growth with accretive M&A opportunities. We believe that Assure’s rapid acceleration in number of procedures performed, generated organically and through the acquisition of Neuro-Pro, strengthens our negotiating position and ability to sign additional in-network insurance agreements, another key initiative for the Company in 2020.”
Farlinger continued, “This Acquisition improves our financial position. In 2019, on an unaudited basis, Neuro-Pro generated approximately $6 million of incremental cash receipts from revenue and roughly $3 million in net income. We expect to unlock additional business opportunities in Texas because of this acquisition and meaningfully improve Neuro-Pro’s historic per procedure revenue in 2020 and beyond. Moreover, Neuro-Pro has built and nurtured important relationships, including with some of the most prestigious spine surgeons in the Dallas Ft. Worth area.”
Farlinger added, “The final terms for this acquisition are highly favorable from a payment schedule and cost of capital perspective. We are pleased that Assure shareholders will benefit from this immediately accretive transaction.”
Farlinger concluded, “I want to officially welcome the Neuro-Pro team to the Assure family. We have already made substantial progress executing our integration plan.”
Jason Papes, Neuro-Pro’s principal said, “We chose to join Assure because we share a commitment to clinical excellence and an exceptional standard of patient care. With the scale, resources and expertise that Assure provides, we expect to bring additional surgeons onto the platform in the Dallas Ft. Worth metroplex and elsewhere.”
Pursuant to the Completed Agreement Assure will pay US$7.7 million to Neuro-Pro. The Purchase Price (the “Purchase Price”) will be paid as follows:
- US$530,000, was paid on February 14, 2020;
- US$1,200,000 on March 31, 2020;
- monthly payments of US$328,462 commencing in April 2020 to April 2021; and
- a final cash payment of US$1,700,000 (the “Final Cash Payment”) on May 31, 2021
About Assure Holdings
Assure Holdings Corp. is a Colorado-based company that works with neurosurgeons and orthopedic spine surgeons to provide a turnkey suite of services that support intraoperative neuromonitoring activities during invasive surgeries. Assure employs its own staff of technologists and uses its own state-of-the-art monitoring equipment, handles 100% of intraoperative neuromonitoring scheduling and setup, and bills for all technical services provided. While Assure focuses primarily on supporting spinal and vascular surgeries, plans are in place to support other classes of medicine that rely on the standard of care that intraoperative neuromonitoring provides. Assure Neuromonitoring is recognized as providing the highest level of patient care in the industry and has earned the Joint Commission’s Gold Seal of Approval®. For more information, visit the company’s website at www.assureneuromonitoring.com.
About Neuro-Pro Monitoring
Established in 2012, Neuro-Pro Monitoring is a premier intraoperative neuromonitoring company serving the Dallas Ft. Worth metroplex. Over the past eight years, Neuro-Pro has grown into a distinguished organization focused on patient care, employee satisfaction and customer service. The company’s 13 technologists supporting 25 surgeons across 14 facilities. Neuro-Pro has established a reputation of excellence by the way we conduct ourselves, our business and treating our employees and customers with the highest respect.
This news release may contain “forward-looking statements” within the meaning of applicable securities laws, including, but not limited to: comments with respect to strategies; expectations; planned operations; future actions of the Company; that the Acquisition will be transformational to the Company by (i) reinforcing the Company’s strategic growth plan, (ii) creating scale through the augmenting the Company’s organic growth with accretive M&A opportunities, and (iii) strengthening the Company’s negotiating position and ability enter into agreements with other in-network insurance companies; that the Acquisition will strengthen and diversify the Company’s revenue stream and increase the number of procedures performed; the Acquisition will accelerate the Company’s growth and provide the Company with new contacts in the insurance industry; that the Acquisition will improve the Company’s financial position by increasing the Company’s earnings and cash flow; that the Acquisition will unlock additional business opportunities in Texas and create the opportunity for collaboration with industry leaders in the IONM industry; that the Company will be able to successfully integrate Neuro-Pro into its strategic plans and help Neuro-Pro’s business succeed or grow; that the terms of the Acquisition are favorable to the Company; that the Company will be able to pay the Purchase Price; and that the Company will obtain TSXV approval for the issuance of the Common Shares or the Completed Agreement. Forward-looking statements may generally be identified by the use of the words "anticipates," "expects," "intends," "plans," "should," "could," "would," "may," "will," "believes," "estimates," "potential," "target," or "continue" and variations or similar expressions. These statements are based upon the current expectations and beliefs of management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to: future capital requirements and the Company’s financial position after the Acquisition; growing competition in the IONM industry; reliance on strategic partnerships with both surgeons and national insurance providers within the jurisdictions in which the Company operates; the Company’s ability to execute its growth plans; the Company’s ability to continue to make acquisitions in the IONM industry; the Company’s ability to pay the Purchase Price; the Company’s ability to successfully complete 2,500 patient cases by the date of the Final Cash Payment; the Company’s ability to successfully integrate Neuro-Pro; the Company’s ability to increase (i) the number of procedures performed, (ii) its contacts in the insurance industry, (iii) business opportunities, (iv) the Company’s negotiating position with respect to new IONM contracts and (v) its scale through the augmenting the Company’s organic growth as a result of the Acquisition; and the TSXV may not provide its approval for the issuance of the Common Shares; the risks and uncertainties discussed in our most recent annual and quarterly reports filed with the Canadian securities regulators and available on the Company’s profile on SEDAR at www.sedar.com, which risks and uncertainties are incorporated herein by reference. Readers are cautioned not to place undue reliance on forward-looking statements. Except as required by law, Assure does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Scott Kozak, Investor and Media Relations
Assure Holdings Corp.
John Farlinger, Chief Executive Officer
Assure Holdings Corp.
Released February 18, 2020