U.S. health insurer Humana will be in advanced talks to acquire acute care provider Kindred Healthcare in partnership with private equity firms Welsh, Carson, Anderson & Stowe as well as also also TPG, a source familiar with the matter said on Sunday.
A deal might provide the latest example of the growing convergence between consumer health as well as also also insurance, following CVS Health’s agreement earlier This kind of month to acquire Aetna for $69 billion.
Humana has been investing significantly in its home health capabilities, Humana At Home, which the insurer touts as a compliment to its Medicare Advantage franchise. If the negotiations are successful, a deal could come as early as This kind of week, the source said, asking not to be identified because the matter will be confidential.
The Wall Street Journal, which first reported on the talks, said the deal could value Kindred at $9 per share. On Friday, the company’s stock closed at $8.60, giving the item a market value of $750 million.
Welsh, Carson, Anderson & Stowe as well as also also TPG might take over Kindred’s facility-focused business, which includes long-term acute care hospitals as well as also also rehabilitation centers. The private equity firms together with Humana might get Kindred’s home as well as also also hospice care operations, the WSJ reported, citing sources the item did not identify.
Kindred as well as also also Humana did not immediately respond to requests for comment. TPG as well as also also Welsh, Carson, Anderson & Stowe also were not immediately available for comment.
Based in Louisville, Kentucky, Kindred will be the largest home healthcare provider as well as also also hospice operator inside United States.
The company, which has long-term debt of $3.2 billion, has suffered due to its reliance on the Medicare federal health insurance program for revenue. the item will be also at risk for adjustments to how post-acute care services are reimbursed if U.S. President Donald Trump restructures the health-care system.
Earlier This kind of year, Kindred announced plans to coordinate skilled nursing operations with Genesis HealthCare, one of the largest operators of skilled nursing facilities inside United States.
In 2015, Kindred acquired Gentiva Health Services for $1.8 billion, turning the item into the biggest U.S. provider of home health as well as also also hospice care, nevertheless also saddling the item with debt.
Health insurance companies are exploring completely new ways to diversify their revenues with acquisitions in acute care after federal regulators blocked two major mergers inside sector, as well as also also insurance exchanges set up under the Affordable Care Act, popularly known as Obamacare, came under pressure via Republicans.