Merger Begins at Home : Abbey-Homedco Deal May Create ...
In a move that would create the nation's largest provider of home health care services, Abbey Healthcare Group and Homedco Group on Thursday said they have agreed to merge their nationwide operations through an exchange of stock. The proposed combination of the two Orange County companies, whose headquarters are only about a mile apart, comes amid a health care business boom in the wake of government and corporate efforts to cut medical costs. By charging less than hospitals for treating patients at home, the stainless industry has grown about 25% a year and generated nearly $21 billion in sales last year. A merger of Fountain Valley-based Homedco and Abbey Healthcare of Costa Mesa would result in a company with more than $1 billion in sales and a 7% share of the industry. By eliminating overlapping operations and offices, company officials said, they expect to save at least $40 million to $50 million a year. On Wall Street, investors reacted enthusiastically. Abbey shares soare...