Healthcare service provider Agiliti is set to acquire Sizewise Rentals, a manufacturer of specialty hospital beds, for $230 million in an all-cash, stock purchase transaction.

The addition of Sizewise, which also manufactures therapeutic surfaces and mobility equipment for enhanced healing and better caregiver satisfaction, is expected to help Agiliti address a number of needs in the growing specialty equipment services market with its products and operational capabilities.

The deal is set to be completed early in the fourth quarter of 2021 and will be financed through a combination of cash and debt. Agiliti and Sizewise expect to make up to $5 million in annual cost synergies in the first year alone, and rake in $15 million within three years. News of the acquisition sent Agiliti shares up Tuesday, according to TheStreet.

“The combination builds on our existing geographic footprint and adds relevant scale to our Equipment Solutions service line, while simultaneously expanding our capabilities to bring differentiated products and services to market for our customers,” said Tom Leonard, CEO of Agiliti, in a statement.

Sizewise is expected to help scale Agiliti’s infrastructure and strengthen its capabilities in the supply chain to provide greater control over R&D, manufacturing and logistics for a vital and differentiated product category. It also will help Agiliti meet new demands for bariatric patients and those at risk of skin and fall injury, while helping to ensure high utilization of devices by enhancing Agiliti’s end-to-end service model.

Sizewise works with hospital discharge planners to make sure equipment meets all requirements for moving patients to post-acute care. In addition to designing bed frames, it uses tech fabrics and designs to create comfortable support surfaces for enhanced healing, as well as designing safe patient handling and mobility equipment such as sit-to-stand chairs for positioning patients appropriately.

Agiliti, meanwhile, helps in-house teams repair and perform preventive maintenance to ensure bed availability. Earlier this year, the company launched a $500 million IPO on the New York Stock Exchange that is poised to rack up $2.6 billion in market value. It also acquired, around the same time, Northfield Medical, a nationwide provider of surgical equipment repair services, for $475 million to enhance repairs for endoscopes and surgical instruments.

Together, Agiliti and Sizewise plan to optimize their complementary distributed operations networks to increase local market presence and boost one another’s operational workflow. These networks include facilities, vehicles, staff, products and operating systems.

Sizewise provides solutions for more than 3,000 customers in the acute and post-acute care markets for bariatric, geriatric, pediatric and standard patient population needs. It raked in $155 million in revenue for 12 months, it reported in June 2020, and had an Adjusted EBITDA of $30 million. It is made up of 65 local, in-market service branches and has four manufacturing centers in Kansas and California.

“They do not have a manufacturing presence as we do, and they will now have access to our products and innovation. We view this as a complementary transaction that offers potential for future growth,” said Sizewise CEO Brain Frickey. He adds that more news on the combination of both companies is expected to follow the completion of the deal.

Headquartered in Minneapolis, Agiliti serves more than 7,000 national, regional and local acute care and alternate site providers across the U.S.

The deal has been approved by both companies’ boards of directors and is subject to customary closing conditions.