Corrections Corporation Of America Acquires Correctional Alternatives

(RTTNews) - Corrections Corporation of America (CXW) or CCA announced that it has closed on the acquisition of Correctional Alternatives Inc. or CAI, a privately held community corrections company, for approximately $36 million, excluding transaction related expenses. The all-cash transaction closed July 31, 2013 and CCA will not assume any debt as part of the transaction.

Founded in 1987, CAI provides cost-effective solutions for housing and rehabilitation through community corrections. CAI is currently responsible for approximately 450 residents and inmates concentrating on community corrections and specializing in work furloughs, residential reentry programs and home confinement for San Diego County, the Federal Bureau of Prisons or BOP and United States Pretrial Services and Probation. CAI owns a 120-bed facility and controls a 483-bed facility through a long-term lease.

The acquisition is expected to increase CCA's total annual revenues by approximately $14 million and EBITDA by approximately $5 million on a fully annualized basis, excluding transaction related expenses and transitional costs. After considering recurring depreciation and amortization expenses, CCA expects the acquisition will be approximately $0.03 accretive to fully annualized 2014 pro forma earnings per share, with a neutral impact on 2013 earnings per share.