Updated Tuesday morning:
Cardinal Health has announced its intent to buy a majority stake in naviHealth in a deal expected to close later this week. Ohio-based Cardinal is paying $290 million in cash for 71 percent of Brentwood-based naviHealth — which works with some 2 million health plan members — with the goal of buying the remainder of the company in stages over the next four years.
“Discharge and post-acute care coordination is critical for both hospital CEOs and their patients, as care is increasingly delivered in alternative sites and payment models shift the focus to patient outcomes rather than activity,” said Michael Petras, president of Cardinal Health at Home. “The acquisition of naviHealth aligns with Cardinal Health’s strategic priority of offering the most complete and integrated suite of services to meet the needs of our Integrated Delivery Network, hospital and other customers.”
Clay Richards, CEO of naviHealth, and his team will stay on to run the company and report up Petras. Cardinal executives say naviHealth will be accretive to the earnings of their medical segment, which in fiscal 2015 posted a segment margin of 3.8 percent on revenues of more than $11 billion.
As originally reported:
Milt Capps on Monday afternoon reported that medical products and services distribution giant Cardinal Health appears to be on the verge of buying local post-acute care manager naviHealth in a deal that could be worth as much as $400 million.
A Federal Trade Commission filing — check it out here — shows the deal clearing a notable regulatory hurdle. Buying naviHealth would be Cardinal's second major 2015 move involving a Middle Tennessee company: In April, the $103 billion-revenue company (Ticker: CAH) snapped up Metro Medical Supply.
SEE ALSO: A news release Monday from naviHealth saying it has extended its contract with a large Wisconsin health plan
Community Health Systems executives and their peers at the Metro Health hospital system in the Grand Rapids region have pulled the plug on a planned $260 million acquisition by the locally based industry leader. The parties' talks were first made public almost two years ago, and a succesful deal would have taken CHS into Michigan for the first time.
Metro Health opted to pursue a deal with Community Health Systems after rejecting proposals from other for-profit and nonprofit health systems, including the University of Michigan Health System and Livonia-based Trinity Health — the parent corporation of Mercy Health Saint Mary’s in Grand Rapids and Mercy Health Muskegon.
Executives at Nashville-based Emdeon say they plan to issue $250 million of debt to help fund their planned $910 million acquisition of Altegra Health. The six-year notes are being marketed via a private offering. Florida-based Altegra markets analytics and risk management services to insurers and in the past 12 months rang up adjusted EBITDA of $59 million on revenues of $212 million. Adding it to Emdeon will grow the company's annual sales to $1.6 billion.
Pinnacle Financial Partners has completed its acquisition of CapitalMark Bank & Trust in Chattanooga, a move that grows Pinnacle to 37 offices and $7.6 billion in assets. CapitalMark's four offices will keep their name until next March, when the integration of the two companies will be wrapped up.
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