The GEO Group is set to acquire a smaller corrections corporation, LCS Corrections. The merger could cost GEO up to $350 million dollars—borrowed from their $700 million revolving line of credit—and will add eight new facilities, and 6,500 new beds to GEO’s existing 79,000 bed capacity.
GEO is looking forward to an estimated $75-80 million extra in annual revenue. On LCS's end, the deal will bail them out of nearly $302 million in debt. The deal will reportedly be finalized by the end of this February.
A Louisiana based company, LCS, while small in comparison, is no stranger to GEO-sized gaffes and scandals. LCS has a long history of not taking proper care of the people in their facilities, racking up a number of wrongful death and corruption suits. Most recently, a former LCS warden was indicted for attempting to bribe a Justice of the Peace in Texas.
The acquisition will expand GEO Group's reach in Texas, where LCS Corrections currently operates the Brooks County Detention Center, the East Hildago Detention Center, and the Coastal Bend Detention Center.