CINCINNATI--(BUSINESS WIRE)--Feb. 24, 2004--Roto-Rooter Inc.
("Roto-Rooter") (NYSE:RRR) (OTCBB:CHEQP) today announced that its
Comfort Care Holdings subsidiary completed its merger with VITAS
Healthcare Corporation ("VITAS"), effective February 24, 2004. As a
result of the merger, Roto-Rooter acquired the VITAS shares it did not
Under the terms of the merger agreement, VITAS shareholders will
receive cash of $30 per share. The transaction, including the
refinancing of existing VITAS debt and other payments made in
connection with the merger, totaled approximately $406 million in
Commenting on the acquisition, Roto-Rooter President and Chief
Executive Officer Kevin J. McNamara said, "The acquisition of VITAS
will enable Roto-Rooter shareholders to realize the full benefit of an
investment made more than a dozen years ago. Roto-Rooter will now
recognize 100% of the revenues and earnings of VITAS. We are pleased
to welcome the VITAS employees into the Roto-Rooter family of
companies and look forward to VITAS' continued success."
Also commenting on the acquisition, Hugh Westbrook, VITAS
co-founder and retiring chairman and chief executive officer, said,
"The VITAS employees are pleased to become part of a company with
Roto-Rooter's significant experience in the healthcare field. VITAS
has long worked with the leadership of Roto-Rooter, which has played
an integral part in VITAS' growth and development, and we are
confident in Roto-Rooter's commitment to the hospice mission and to
providing quality care to our patients and their families."
VITAS, a pioneer and leader in the hospice movement since 1978, is
the nation's largest provider of end-of-life care. Headquartered in
Miami, Florida, VITAS operates 25 hospice programs in eight states
(California, Florida, Illinois, New Jersey, Ohio, Pennsylvania, Texas,
and Wisconsin). VITAS reported revenues of more than $420 million for
its fiscal year ended September 30, 2003. VITAS employs more than
6,100 professionals who care for more than 8,000 terminally ill
patients daily, primarily in the patients' homes, but also in the
company's 18 hospice inpatient units, as well as in hospitals, nursing
homes, and assisted living/residential care facilities for the
Roto-Rooter funded the merger with debt financing and the proceeds
received from the sale of 2 million shares of Roto-Rooter Inc. Capital
Stock, issued in a private placement at a price of $50 per share. Bank
One Capital Markets Inc. acted as agent for a $100 million revolving
credit facility and a $35 million term loan, which matures in five
years. In addition, Roto-Rooter entered into floating rate notes in
the amount of $110 million. The floating rate notes carry an interest
rate of LIBOR plus 3.75% per year and will mature in six years.
Roto-Rooter also entered into fixed rate notes in the amount of $150
million. The fixed rate notes carry an interest rate of 8 3/4% per
year and will mature in seven years. Lazard Freres & Co. LLC acted as
placement agent for the floating and fixed rate notes and the
Roto-Rooter Inc. Capital Stock.
Listed on the New York Stock Exchange and headquartered in
Cincinnati, Ohio, Roto-Rooter Inc. (www.RotoRooter.com) operates in
the residential and commercial repair-and-maintenance-service industry
under the names Roto-Rooter and Service America Network Inc.
Roto-Rooter also operates in the healthcare field through its VITAS
Healthcare Corporation subsidiary. VITAS is the nation's largest
provider of end-of-life hospice care services. Roto-Rooter is North
America's largest provider of plumbing and drain cleaning services.
Service America provides major-appliance and heating/air-conditioning
repair, maintenance, and replacement services.
Statements in this press release or in other Roto-Rooter
communications may relate to future events or Roto-Rooter's future
performance. Such statements are forward-looking statements and are
based on present information Roto-Rooter has related to its existing
business circumstances. Investors are cautioned that such
forward-looking statements are subject to inherent risk that actual
results may differ materially from such forward-looking statements.
Further, investors are cautioned that Roto-Rooter does not assume any
obligation to update forward-looking statements based on unanticipated
events or changed expectations.
CONTACT: Roto-Rooter Inc.
David P. Williams, 513-762-6901
SOURCE: Roto-Rooter Inc.