Resources for Human Development has tentative deal to be acquired by Inperium Inc.
The RHD board has turned to a nonprofit known for making aggressive acquisitions for a financial rescue.
Financially beleaguered Resources for Human Development said Tuesday that it had reached a preliminary agreement to be acquired by Inperium Inc., a Reading nonprofit that has expanded rapidly through acquisitions.
The move comes two months after RHD’s CEO Marco Giordano abruptly left amid mounting financial problems.
RHD, a large Philadelphia health and social services provider, had at least two rounds of layoffs in January and this month, affecting more than 250 people in administrative positions, according to sources.
Giordano had informed staff in February that RHD was expecting an $8 million loss in the year ended June 30, up from a $3 million loss in fiscal 2023. RHD had $308 million in revenue from its programs in more than a dozen states, but very little cash reserves to help it through hard times financially.
RHD has not responded to requests for interviews since The Inquirer first reported the news of Giordano’s departure.
Last month, RHD hired as interim CEO Jay Deppeler, a veteran human services executive who worked at Inperium for four years through March 2021. Deppeler, who was hired on April 16, introduced himself to staff via email Tuesday.
“I know that there have been a lot of rumors and speculation about what is happening at RHD. Plainly stated, we have a lot of work to do on the financial side of the house,” Deppeler wrote in an internal message obtained by The Inquirer.
RHD did not give a timeline for reaching a definitive agreement with Inperium, which had made an offer to acquire RHD in February. The terms of that proposal called for Inperium to give RHD $10 million and to lend it $25 million that RHD would have two years to pay back. RHD would also pay Inperium a management fee under the proposal, which The Inquirer has seen.
In addition, Inperium said RHD would become the corporate parent of four other nonprofits with $148 million in annual revenue that Inperium had acquired since 2017. It’s not clear if terms of the proposed deal have changed since February.
Inperium has “pledged to support RHD in finding alternative financing avenues to restructure our day-to-day operations,” a statement Tuesday from RHD said.
Inperium had $362.5 million in revenue from 30 subsidiaries in 11 states in the year ended June 30, 2023.
Inperium paid its founder, a nonprofit executive named Ryan Smith, more than $1.4 million in 2021, according to Inperium’s tax return.