ACQUISITIONS

12 Months Ended

Dec. 31, 2024

Business Combinations [Abstract]

MERGERS, ACQUISITIONS AND DISCLOSURES

MERGERS, ACQUISITIONS AND DISPOSITIONS

Mergers

On June 26, 2023, Amedisys, UnitedHealth Group Incorporated, a Delaware corporation ("UnitedHealth Group"), and Aurora Holdings Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of UnitedHealth Group ("Merger Sub"), entered into an Agreement and Plan of Merger (the "Merger Agreement"), pursuant to which Merger Sub will merge with and into Amedisys with Amedisys continuing as the surviving corporation and becoming a wholly owned subsidiary of UnitedHealth Group (the “Merger”).

On November 12, 2024, the U.S. Department of Justice (“DOJ”) and certain other parties commenced litigation (the “DOJ Action”) against Amedisys and UnitedHealth Group alleging that the Merger, if consummated, would violate Section 7 of the Clayton Act and so should be enjoined. Additionally, the DOJ Action alleges that the Company committed certain violations of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and requests civil penalties against the Company for alleged violation of Section 7A. We believe the plaintiffs' claims are without merit and intend to vigorously defend against such claims. The DOJ Action remains pending. The U.S. District Court for the District of Maryland has tentatively set October 27, 2025 as the start date for the trial, but may reschedule the trial to begin later, on or about February 9, 2026. The U.S. District Court for the District of Maryland has stated that it will make a final determination as to the trial date in late August 2025. See Part I, Item 1A. "Risk Factors – Litigation challenging the Merger Agreement may prevent the Merger from being consummated by the end of the Waiver Period or at all" for additional information.

On December 26, 2024, each of the parties to the Merger Agreement entered into a waiver (the “Waiver”) pursuant to which, among other things, Amedisys and UnitedHealth Group each waived its right to terminate the Merger Agreement due to a failure of the Merger to have been consummated by the outside date (as defined in the Merger Agreement) until the earlier of (i) 5:00 p.m. (New York time) on the tenth business day following a final order (whether or not appealable) issued by the U.S. District Court for the District of Maryland with respect to the complaint filed by the DOJ and certain other parties regarding the Merger and the other transactions contemplated by the Merger Agreement that permanently prohibits the consummation of the Merger and (ii) 11:59 p.m. (New York time) on December 31, 2025 (the “Waiver Period”). The Waiver also contains waivers by the parties thereto such that, (i) the Regulatory Break Fee (as defined in the Merger Agreement) under the Merger Agreement will be $275,000,000, which may escalate up to $325,000,000 for the failure to meet certain timing milestones related to divesting certain assets to gain approval; (ii) the revenue-related aspect of the definition of “Burdensome Condition” (as defined in the Merger Agreement) is increased, (iii) Amedisys may take certain actions that would otherwise be prohibited by interim operating covenants contained in the Merger Agreement and (iv) certain closing conditions relating to government approvals are no longer conditions to the consummation of the Merger.

Subject to the terms and conditions set forth in the Merger Agreement, as modified by the Waiver, at the effective time of the Merger (the "Effective Time"), by virtue of the Merger: (i) each share of Amedisys common stock (“Amedisys Common Stock”) held in treasury by Amedisys or owned by UnitedHealth Group or Merger Sub or any of their respective subsidiaries, in each case, immediately prior to the Effective Time will be cancelled (collectively, “cancelled shares”) without consideration; and (ii) each share of Amedisys Common Stock, other than any cancelled shares, issued and outstanding immediately prior to the Effective Time will be converted into the right to receive $101 per share in cash, without interest, less any applicable withholding taxes.

On June 28, 2024, Amedisys, UnitedHealth Group and certain of their respective subsidiaries entered into an agreement (the "VCG Purchase Agreement") relating to the sale of certain Amedisys home health care centers and certain UnitedHealth Group care centers to VCG Luna, LLC ("VCG Luna"), an affiliate of VitalCaring Group. On January 3, 2025, UnitedHealth Group delivered a notice (the "Termination Notice") to VCG Luna terminating the VCG Purchase Agreement, following which, on January 8, 2025, UnitedHealth Group and VCG Luna entered into an agreement which provides for, among other things, the mutual release by the parties thereto of all claims against the other parties to the VCG Purchase Agreement that relate to the VCG Purchase Agreement.

The Merger is subject to a number of conditions to closing as specified in the Merger Agreement, as modified by the Waiver. These closing conditions include, among others, (i) approval by Amedisys stockholders at the Amedisys Stockholders Meeting (as defined in the Merger Agreement) of the proposal to adopt the Merger Agreement, which approval was obtained on September 8, 2023; (ii) the expiration or termination of the applicable waiting period (and any extension thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (iii) the receipt of the required state regulatory approvals; (iv) the absence of any law or order that has the effect of enjoining or otherwise prohibiting the completion of the Merger; and (v) the expiration or early termination of the waiting period (and any extension thereof) applicable to the consummation of the transactions contemplated by the Merger Agreement under all applicable antitrust laws without the imposition by any governmental entity of any term, condition, obligation, requirement, limitation, prohibition, remedy, sanction or other action that has resulted in or would reasonably be expected to result in a Burdensome Condition (as defined in the Merger Agreement as modified by the Waiver).

Termination of Option Care Health, Inc. ("OPCH") Merger Agreement

As previously disclosed in Amedisys’ Current Report on Form 8-K filed with the SEC on May 3, 2023 and its Quarterly Report on Form 10-Q filed with the SEC on May 4, 2023, Amedisys entered into an Agreement and Plan of Merger on May 3, 2023 (the “OPCH Merger Agreement”) with OPCH, a Delaware corporation, and Uintah Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of OPCH (“OPCH Merger Sub”). On June 26, 2023, Amedisys, OPCH and OPCH Merger Sub entered into the Termination Agreement (the “Termination Agreement”), pursuant to which the parties thereto agreed to terminate the OPCH Merger Agreement and grant mutual releases by the parties of all claims against the other parties based upon, arising from, in connection with or relating to the OPCH Merger Agreement. Pursuant to the terms of the Termination Agreement, each of the termination of the OPCH Merger Agreement and the mutual releases provided for in the Termination Agreement would become effective upon receipt by OPCH of a $106,000,000 termination fee payable by, or on behalf of, Amedisys within 24 hours of the execution of the Termination Agreement (i.e., before the market open on June 27, 2023). On June 26, 2023, following the execution of the Termination Agreement, UnitedHealth Group, on behalf of Amedisys, delivered funds to OPCH in an amount equal to $106,000,000, representing the termination fee payable to OPCH under the OPCH Merger Agreement and the Termination Agreement, satisfying the condition precedent to the effectiveness of the termination of the OPCH Merger Agreement and the releases contained in the Termination Agreement. If the Merger Agreement is terminated under certain specified circumstance set forth in the Merger Agreement (as modified by the Waiver), Amedisys may be required

to reimburse UnitedHealth Group for the $106,000,000 termination fee that UnitedHealth Group, on Amedisys' behalf, paid to OPCH, which may be in addition to the $125,000,000 termination fee payable by Amedisys to UnitedHealth Group in the event the Merger Agreement is terminated under certain specified circumstances. During the year ended December 31, 2023, the $106,000,000 termination fee was recorded to other income (expense) within our consolidated statement of operations with a corresponding liability to termination fee paid by UnitedHealth Group within our consolidated balance sheet.

Acquisitions

We complete acquisitions from time to time in order to pursue our strategy of increasing our market presence by expanding our service base and enhancing our position in certain geographic areas as a leading provider of home health, hospice and high acuity care services. The purchase price paid for acquisitions is negotiated through arm’s length transactions, with consideration based on our analysis of, among other things, comparable acquisitions and expected cash flows. Acquisitions are accounted for as purchases and are included in our consolidated financial statements from their respective acquisition dates. Goodwill generated from acquisitions is recognized for the excess of the purchase price over tangible and identifiable intangible assets because of the expected contributions of the acquisitions to our overall corporate strategy. We typically engage outside appraisal firms to assist in the fair value determination of identifiable intangible assets and noncontrolling interests, if any, for significant acquisitions. The preliminary purchase price allocation is adjusted, as necessary, up to one year after the acquisition closing date if management obtains more information regarding asset valuation and liabilities assumed.

2023 Acquisitions

On January 20, 2023, we acquired the regulatory assets of a home health provider in West Virginia for a purchase price of $0.4 million. The purchase price was paid with cash on hand on the date of the transaction. We recorded goodwill of $0.3 million and other intangibles (certificate of need) of $0.1 million in connection with the acquisition.

Dispositions

On February 10, 2023, we signed a definitive agreement to sell our personal care business (excluding the Florida operations, which were closed during the three-month period ended March 31, 2023). The divestiture closed on March 31, 2023. We received net proceeds of $47.8 million and recognized a $2.2 million loss during the three-month period ended March 31, 2023, which is reflected in miscellaneous, net within other income (expense) in our consolidated statement of operations. The net proceeds of $47.8 million is inclusive of $6.0 million that was placed into an escrow account in accordance with the closing payment and indemnity provisions within the purchase agreement.

Of the total $6.0 million placed into escrow, $1.0 million was set aside for the closing payment adjustment. The closing payment calculated on the acquisition date included estimates for cash, working capital and various other items. Under the purchase agreement, the purchase price was subject to an adjustment for any differences between estimated amounts included in the closing payment and actual amounts at close. The closing payment adjustment was finalized during 2023 with $0.1 million being paid to Amedisys by the buyer. The $1.0 million in escrow related to the closing payment adjustment was released to Amedisys during 2023. The remaining $5.0 million placed into escrow, which related to indemnity provisions within the purchase agreement, was released to Amedisys during the second quarter of 2024.

The disposition of our personal care business did not qualify as a discontinued operation because it did not represent a change in strategy that has or will have a major effect on the Company's operations or financial results.

We derecognized goodwill of $43.1 million in connection with the divestiture.