Market Overview

Envision Healthcare To Go Private In $9.9B, All-Cash Deal

Envision Healthcare To Go Private In $9.9B, All-Cash Deal

After a seven-month-long strategic option review, the Envision Healthcare Corp (NYSE: EVHC) board finally clinched a sale Monday. 

Envision shares were adding 2.67 percent to $44.80 Monday morning after the announcement. 

What Happened

Envision Healthcare inked a deal to be bought by KKR & Co. L.P. Unit (NYSE: KKR)for $46 per share, or $9.9 billion in cash. The per-share transaction value represents a 32-percent premium to the volume-weighted average share price from Nov. 1, 2017, the time of announcement of review of strategic options, the company said in a release.

"The transaction price represents a multiple of 10.9x trailing 12 months Adjusted EBITDA and 10.1x 2018 anticipated adjusted EBITDA," according to Envision. 

Why It's Important

After reaching out to 25 potential buyers, Envision said it zeroed in on the KKR deal, as the offer is likely to deliver the most value to its shareholders.

"Envision has a very strong reputation for delivering high-quality, patient-focused care through its network of 25,000 clinical professionals at thousands of hospitals, surgery centers and alternate sites of care across the country," said Jim Momtazee, head of KKR's health care investment team.

What's Next

Envision expects the deal to close in the fourth quarter pending closing conditions and regulatory approvals. The company said it will recommend the proposed deal to its shareholders at its 2018 annual meeting, which is scheduled to be held no later than Oct. 1.

Pursuant to the closing of the deal, Envision shares will be delisted from the NYSE, as it will be cease to be a public company.

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