SOUTHFIELD, Mich.--Arcadia Resources announced on Thursday it has sold its DME locations in Florida and Colorado to Aerocare Holdings in two separate transactions totaling $7.7 million.

In connection with the sales, Arcadia will retain the accounts receivable for services provided at these sites before Aug. 16, totaling approximately $7 million. After using part of the proceeds to reduce debt and other obligations by $4.3 million, Arcadia will have approximately $10 million to support its ongoing operations, the company said.

Arcadia's remaining DME operations include 22 locations that generate approximately $24 million in gross revenues, according to the company. Earlier this year, Arcadia--which had made more than 20 DME acquisitions and opened stores inside Sears and Wal-Mart--announced it would sell other portions of its DME business for $16.5 million. In July, the company restructured operations.

The company also said CMS had confirmed a correction of the issuance date for one of its supplier numbers and, as a result, expected to receive Medicare reimbursement for equipment and services previously thought to be uncollectible.

"We expect this will provide between $700,000 and $800,000 in additional EBITDA and cash flow for the company and will help us move towards our stated commitment of being EBITDA and cash flow positive beginning in October 2007, our fiscal 2008 third quarter," said CEO Marvin Richardson.

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