Target Would Serve as Quipt’s Entrance Into Comprehensive Respiratory Care Within the Long-Term Care Setting, and Provide Cross Selling Opportunity

Target Services Seven States, Including Four New States Within Quipt’s Operating Footprint, With 165 Respiratory Therapists

CINCINNATI, Nov. 22, 2021 (GLOBE NEWSWIRE) -- Quipt Home Medical Corp. (“Quipt” or the “Company”) (NASDAQ:QIPT, TSXV:QIPT), a U.S. based leader in the home medical equipment industry, focused on end-to-end respiratory care, is very pleased to announce that it has executed a non-binding letter of intent (the “LOI”) dated November 22, 2021 to acquire an arm’s length private respiratory care company servicing seven states throughout the U.S. reporting unaudited trailing 12-month annual revenues of approximately $14 million, $1 million in net income, and positive Adjusted EBITDA (defined below).

Acquisition Details

The target specializes in providing high-quality, comprehensive respiratory care to patients in the long-term care setting including ventilator management, equipment, oxygen and providing supplies. The target provides these facilities with not only the necessary clinical personnel, but also state-of-the-art respiratory tools and equipment, making it easy for them to care for patients with complex respiratory needs. The target also has a pulmonary rehabilitation service, which assists patients with an even wider variety of respiratory care issues. The target services facilities in seven states throughout the United States, four of which would be new states for Quipt. The target employs 165 remote respiratory therapists which would significantly bolster an already robust Quipt clinical team. With a mission that seeks to improve the patients’ health and quality of life by providing outstanding, compassionate respiratory care and unparalleled customer service, this target matches the same passionate mission that Quipt continues to employ.

The target represents a new vertical of business for Quipt, which would leverage the Company’s highly successful clinical respiratory care platform serving patients in the home, into the long-term care setting. Quipt anticipates purchasing power advantages to bring down the cost of respiratory equipment, and cross selling opportunities to service additional patient needs with complimentary equipment, and supplies. The target would expand Quipt’s reach, offerings, and allow for the Company to access more sales touch points, which the Company anticipates will have benefit to its current business.

According to the LOI, Quipt expects to close the acquisition for $5,000,000, plus a $500,000 earn out based on certain revenue targets, payable in cash, that would immediately be accretive to Quipt’s Adjusted EBITDA and net income. As part of the proposed acquisition the Company would not assume any long-term debt of the target. Closing of the acquisition is subject to final due diligence, final negotiation, and execution of a definitive purchase agreement, all closing conditions being satisfied or waived and all necessary approvals and is expected to occur within the next 90 days.

The acquisition would be expected to increase Quipt’s annual revenues by approximately $14 million and $1 million in net income before synergies. Leveraging existing infrastructure, Quipt would expect to achieve additional revenue generated from organic growth, cross selling, and corporate synergies.