Note:  Historical figures are revised downward for cancelled transactions

Following the IPO of Change Healthcare in June 2019, the third quarter saw four additional HCIT IPOs, including Health Catalyst, Phreesia, Livongo, and Peloton. Subsequent to the successful public market debut of these companies, Progyny, a fertility benefits management company, released its S-1 with plans to enter the public market by the end of fiscal year 2019. Through the transaction, the company expects to raise approximately $184 million at an initial offering price range of $14.00 to $16.00 per share.

Notable M&A transactions and partnerships in Q3 2019 include the following:
 

• The University of Louisville (“UL”) board approved a deal to take over Jewish Hospital and KentuckyOne Health's other Louisville assets, which include three more hospitals and four outpatient centers, on Aug. 14. In an interesting twist, the acquirer, UL, will receive a net $126 million in the deal and will pay KentuckyOne $10 million for the assets. KentuckyOne will forgive the $19.7 million UL owes for software under a previous arrangement. KentuckyOne will also transfer $76.4 million in working capital to UL and provide $40 million to UL over four years. UL will also receive $10 million from the Jewish Heritage Fund for Excellence and a partially forgivable $50 million loan from the state. The organizations closed the deal on Nov. 1.
   

• Walmart Health and Amedisys entered into a new partnership to expand healthcare access nationwide. Already, Walmart has opened its first 10,000 square-foot health center in Dallas, Ga. The location is adjacent to a Walmart store there. The prototype clinic features an Amedisys kiosk, which is designed to help educate customers and potential patients on the home health services it provides. With approximately 90 percent of the U.S. population living within 10 miles of a Walmart, and more than half of the U.S. population shopping in Walmart weekly, this provides the opportunity to redirect patient flow into Walmart locations and drive additional patient interactions by providing convenient access points.
   

• Irvine-based REIT HCP (NYSE: HCP) and Brentwood-based owner-operator Brookdale Senior Living (NYSE: BKD) announced a series of transactions totaling more than $1 billion to restructure the relationship between the companies. HCP will acquire Brookdale’s 51 percent stake in a joint ownership venture in 12 entry-fee continuing care retirement communities (“CCRCs”) totaling 5,641 units for $510 million. HCP will also transfer operations of the 12 communities from Brookdale to Life Care Services, paying a $100 million termination fee to Brookdale in the process. In the second transaction, Brookdale will acquire 18 triple-net leased properties from HCP for $405 million. The sale represents a 7.4 percent yield based on trailing 12-month rent.

Questions? Gain Expert Insight

If your institution is considering evaluating options and opportunities for merger, acquisition, or partnership, H2C is uniquely positioned to offer guidance. Let us put our market knowledge and expertise to work for your institution. Contact an H2C professional directly.