Private equity-backed health care provider BrightSpring is divesting its behavioral health business, which includes care for people with intellectual and developmental disabilities (IDD). Sevita, another home and community-based care provider, paid $835 million to acquire the service arm.
Louisville, Kentucky-based BrightSpring announced the deal on Monday, saying that selling its behavioral service arm, ResCare Community Living, allows the company to focus on its core markets and improve revenue and EBITDA performance.
“In Sevita, we are pleased to partner with a new owner with extensive experience in the I/DD industry, who is well-suited to continue to provide compassionate care to the community living client population,” Jon Rousseau, chairman, president and CEO of BrightSpring, said in a statement. “With enhanced combined processes, technology and overall capabilities, there are opportunities to share proven and innovative approaches that should advance possibilities for all constituents in this market. I believe both organizations will significantly benefit from amplified focus on core markets.”
BrightSpring offers care for a variety of physical and behavioral health conditions. Its behavioral health offerings include applied behavioral analysis (ABA), mental health services, community living and a behavioral health pharmacy. Private equity firm KKR bought BrightSpring for $1.32 billion in 2019.
The newly-divested ResCare Community Living business has operated for over 40 years and provides over 100 million hours of care for people with IDD across 2,000 residential homes, according to its site. In 2024, the business is expected to generate approximately $1.2 billion in revenue and $128 million of adjusted EBITDA. It includes 14,000 patients who receive services from 13,500 employees.
After taxes, BrightSpring anticipates a profit of approximately $715 million from the ResCare Community Living sale and plans to use the funds to pay down its debts.
Edina, Minnesota-based Sevita, formerly the MENTOR Network, provides in-home and community-based care for adults and children with IDD, autism, complex care needs and other conditions. It also serves children in the foster system. Sevita employs approximately 45,000 people.
“Sevita and ResCare Community Living share a deep commitment to providing quality community-based health care and improving the lives of those who rely on us every day,” Philip Kaufman, CEO of Sevita, said. “We look forward to welcoming ResCare Community Living’s talented and experienced team to Sevita.”
The deal will streamline BrightSpring’s offerings, increase operational efficiency, refine its payer mix and improve clinical integration and business synergy, according to the company. It will also “maximize exposure” to its target markets: home health, rehab, primary care, hospice and specialty, home and community pharmacy.
The deal marks the second time this month that a behavioral health provider has divested a significant portion of its behavioral services to focus on its primary business. Amwell (NYSE: AMWL) sold its virtual psychiatric business to clinician-to-clinician telehealth provider Avel eCare for $21 million, citing the need to streamline services and pursue core growth channels.
Several other deals have hit the behavioral health space thus far in 2025. Oceans Healthcare acquired Haven Behavioral Healthcare and Iris Telehealth acquired innovaTel, a division of Quartet Health, within the past few weeks.