UnitedHealth's Optum to Acquire Surgical Care in $2.3 Billion Deal -- WSJ
January 10 2017 - 3:02AM
Dow Jones News
By Anna Wilde Mathews
UnitedHealth Group Inc.'s Optum health-services arm has agreed
to acquire Surgical Care Affiliates Inc. for about $2.3 billion,
adding a major surgical company to its growing roster of doctor
groups and clinics.
The deal, for a mixture of cash and stock, substantially expands
the health-care provider footprint of UnitedHealth, which is
already the parent of the biggest U.S. health insurer,
UnitedHealthcare.
The acquisition represents a continued bet on physician services
at a time when Republicans' plans to unwind the Affordable Care Act
have created uncertainty for many health-care providers,
particularly hospitals, which potentially stand to see a drop-off
in insured, paying patients.
UnitedHealth has said Optum aims to provide primary care and
ambulatory services in 75 markets, representing about two-thirds of
the U.S. population. In late November of last year it had clinical
practices in 26, UnitedHealth told investors. Optum has already
been on a yearslong shopping spree, buying up doctor groups around
the country as well as a large urgent-care clinic operator,
MedExpress. UnitedHealth has said it intends to expand MedExpress
in 2017.
The takeover of Surgical Care Affiliates will add a group of
around 200 outpatient surgery centers, along with a few surgical
hospitals and a sleep center, according to the smaller company's
third-quarter filings. Surgical Care Affiliates operated in 33
states as of the end of September. In 2015, it had operating
revenue of around $1.1 billion.
UnitedHealth said it would acquire Surgical Care Affiliates for
$57 per share, with between 51% and 80% of the price coming in the
form of UnitedHealth stock. UnitedHealth will determine the final
percentage, the company said, with the remainder of the payout
coming in cash. The companies expect the deal to close in the first
half of 2017.
Surgical Care Affiliates is about 30% owned by affiliates of
private-equity firm TPG Capital, which supports the deal.
Write to Anna Wilde Mathews at anna.mathews@wsj.com
(END) Dow Jones Newswires
January 10, 2017 02:47 ET (07:47 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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