CCA Acquires Avalon Correctional Services

NASHVILLE, Tenn. — Nashville-based Corrections Corporation of America (CCA), the nation’s largest private prisons operator, grew on Oct. 29 when it announced the purchase of Oklahoma City, Okla.-based Avalon Correctional Services Inc., a privately held company that provides residential reintegration programming to help residents return to their communities. After the purchase, CCA now touts itself as the largest domestic owner of community corrections beds.

The $157.5 million deal includes 100 percent of the stock of Avalon Correctional Services Inc., which consists of seven facilities in Texas, three facilities in Oklahoma and one facility in Wyoming, according to a statement. The deal also includes an agreement to purchase an additional facility operated by Avalon, expected to close later in the fourth quarter of 2015. Add 3,157 re-entry beds from these transactions, CCA now owns and operates 17 re-entry facilities that make up 4,365 beds.

CCA’s goal for its big push into the residential reintegration market is to expand relationships with existing clients such as the federal Bureau of Prisons, which has roughly 9,000 inmates in re-entry facilities nationwide and is seeking additional funding to expand the program, according to The Tennessean. Inmates in these re-entry programs spend the last six months to a year of their sentence in low-custody facilities. They have the option to own a car and drive it to part- or full-time jobs as well as engage with family members, reported The Tennessean.

“We are excited to have Avalon join CCA’s expanding network of high-quality residential re-entry operations,” said Damon Hininger, CCA’s CEO, in a statement. “Avalon has a track record of providing exceptional community corrections programming for more than 30 years, which we believe will be enhanced even further by the combined industry knowledge, expertise and resources of CCA.”

Hininger added, “The residential re-entry space is a natural extension of the broad re-entry programming and capacity solutions we offer in our correctional facilities. Our government partners around the country are seeking ways to help ex-offenders gain the tools and skills needed to return to their communities successfully, which reduces recidivism and improves the quality of life for former inmates and their families. We believe CCA provides the expertise and compelling value proposition to be the ideal provider of these solutions.”

The acquisition of Avalon is expected to increase CCA’s total revenues by approximately $35 million to $40 million.
 

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