A publicly traded radiology provider’s ongoing delays in furnishing financial documents is an “untimely distraction” that could potentially disrupt a recent blockbuster acquisition, Moody’s Investors Service said Thursday, Oct. 14.
Back in August, Akumin Inc. was forced to cancel its second quarter earnings release amid issues with its auditors. The plantation, Florida, imaging operator was slated to submit its delayed Q2 2021 results on Oct. 15 but said the ongoing audit is taking longer than expected.
Moody’s took note, labeling the continued postponement (to as late Nov. 15) “credit negative.” Akumin just closed a deal to buy Alliance Healthcare Services for $820 million and the investor service is concerned such delays could impact the next stage of the process.
“The developments signal elevated governance risks and further damage the company's financial reporting track record,” Moody’s said. “Akumin's prolonged focus on reviewing and restating prior reporting periods is also an untimely distraction that heightens integration risks surrounding the recent acquisition of Alliance Healthcare Services Inc.”
In an email, a company official said Akumin is conducting a “robust review” of its financial results, which is taking more time than originally envisioned due to the Alliance acquisition. Since the firm was already in the process of conducting a review of its accounts-receivable balances, Akumin decided it was “prudent” to review all accounting policies related to the merger.
Upon completion, the combined company will operate across 46 states, serving 1,000 hospital and health system customers, with 154 outpatient imaging centers and 34 radiation therapy clinics.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.