Not with a bang

19 December 2017 By Robert Cyran Follow @rob_cyran

Kindred Healthcare has gone out with a whimper, selling itself for a 5 pct premium to insurer Humana and two private-equity firms. Management may have been a bit too eager to put an end to the company’s uncomfortable public existence with the $4.1 bln deal.

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Humana, TPG Capital and Welsh, Carson, Anderson & Stowe said on Dec. 19 they had agreed to buy Kindred Healthcare in a deal valued at $4.1 billion including debt.

The buyers will split Kindred into two firms. Kindred at Home will focus on home healthcare, while Kindred Healthcare will focus on long-term acute care and rehabilitation. Humana will pay $800 million in cash, and receive a 40 percent stake in Kindred at Home, with the private-equity firms retaining the rest. Humana will have an option to buy the 60 percent it doesn’t own.

Rival insurers Aetna and UnitedHealth Group announced deals earlier this year to expand into healthcare services in locations that charge less than hospitals.

The $9-a-share deal represents a 4.7 percent premium over the close of the stock on Dec. 15, prior to news of a possible deal emerging.

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