Acadia to Sell Priory Mental Hospitals for $1.5 Billion
(Bloomberg) -- Acadia Healthcare Co. agreed to sell Priory Group, a chain of U.K. mental-health facilities known for treating celebrities for drug and alcohol addiction, to Waterland Private Equity for 1.1 billion pounds ($1.5 billion).
Priory operates about 450 sites across the U.K., specializing in treatment of mental health-care problems as well as conditions ranging from addiction to eating disorders. Acadia, which acquired the British operations in 2016, launched a sale process early this year but temporarily suspended it after the Covid-19 pandemic spread across the world.
Acadia, which is based in Franklin, Tennessee, plans to focus on its U.S. operations, according to a statement Wednesday. It said it will use net proceeds of about $1.35 billion for debt reduction and other corporate purposes.
The Covid-19 pandemic and lockdowns imposed around the world have caused a deterioration in mental health. According to a study published in July by The Lancet Psychiatry, more than a quarter of U.K. participants reported a level of mental distress that was potentially clinically significant after the first month of lockdown, compared with one in five people before the pandemic.
From offices across Europe, Waterland manages about 8 billion euros ($10 billion) worth of investments. It plans to combine Priory with Median, a German provider of rehabilitation, neurology and orthopedic treatments and create a European leader in the field, a spokesman said.
Acadia shares rose as much as 5% on Wednesday and were 3.5% higher at 10:31 a.m. in New York, giving the company a market value of $4.5 billion.
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