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VANCOUVER, BC, Feb. 23, 2021 /CNW/ - CRH Medical Corporation ("CRH", or the "Company") (TSX:CRH) (NYSE:CRHM) announces today that it has signed a five-year exclusive Management Services Agreement with United Digestive ("UD"). The agreement is newly structured as a management services agreement, whereby CRH will earn a fee for managing UD's anesthesia service, that can naturally grow as the UD platform realizes its expansion plans. Additional upside may also be realized as CRH further employs its payor contracting strategy in addition to any other opportunities for collaboration.
The new agreement will be effective as of Nov 1, 2021 and is expected to allow the company to retain a material portion of the EBITDA earned by the Company under the present arrangement which will continue to be in full force and effect until Nov 1, 2021.
"We are pleased to have reached a win-win agreement with United Digestive," noted Dr. Tushar Ramani, Chief Executive Officer of CRH. "CRH and our anesthesia staff look forward to continuing to support UD's medical staff, who share our dedication to delivering outstanding patient care."
The Company is well poised to continue its strong growth given its organic and inorganic growth plans. Recently on Feb 9th, 2021, the company announced that it had closed the acquisition of Edison, NJ based gastroenterology anesthesia practice, Oak Tree Anesthesia Associates or "Oak Tree", its 32nd acquisition and first of 2021. It is expected that Oak Tree will contribute approximately US$1.5M in incremental revenues with similar EBITDA margins to the rest of CRH's business.
With the acquisition of Oak Tree acquisition, the company now provides services to 70 ambulatory surgical centers across 14 states. The Company has more than 500 prospects in its watch-list and continues to be focused on its inorganic growth program.
