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UnitedHealth buys LHC Group for $5.4 billion for home health care

FILE PHOTO: The UnitedHealth Group corporate logo appears on the side of one of their office buildings in Santa Ana, California
FILE PHOTO: The UnitedHealth Group corporate logo appears on the side of one of their office buildings in Santa Ana, California, U.S. April 13, 2020. REUTERS/Mike Blake

March 29, 2022

(Reuters) – UnitedHealth Group said on Tuesday it will buy LHC Group for around $5.4 billion in cash as the largest US health insurer expands its home health services.

The deal will combine the provider of home healthcare services, primarily for elderly patients dealing with chronic illnesses and injuries, with UnitedHealth’s Optum unit, which administers drug benefits and provides healthcare data analytics services.

Demand for home health care over clinic-based services has increased in the United States, particularly during the COVID-19 pandemic, as patients and caregivers increasingly prefer to access essential services from the safety of their homes.

The deal comes a month after the US Department of Justice sued to halt UnitedHealth’s $8 billion acquisition of billing and payments provider Change Healthcare, saying the deal would give the health insurer access to its competitors’ data.

UnitedHealth is paying $170 for each LHC Group share, an 8.12% premium over the stock’s last closing price.

Shares of LHC are up 7.5%, trading just below the offer at $168.70 before the opening bell, while those of UNH are marginally higher.

UnitedHealth expects the LHC deal to be neutral versus its adjusted earnings per share guidance in 2022 and slightly up in 2023. LHC Group co-founders Keith and Ginger Myers will invest $10 million in the health insurer’s shares after the deal closes.

Last year, health insurer Humana acquired the remaining 60% stake it didn’t own in home health care provider Kindred at Home for $5.7 billion to expand its patient care business.

SVB Leerink and Jefferies LLC acted as financial advisors to the LHC Group.

(Reporting by Mrinalika Roy and Bhanvi Satija in Bengaluru; Editing by Arun Koyyur, Sriraj Kalluvila and Saumyadeb Chakrabarty)

https://www.oann.com/unitedhealth-to-buy-lhc-group-for-about-5-4-billion/?utm_source=rss&utm_medium=rss&utm_campaign=unitedhealth-to-buy-lhc-group-for-about-5-4-billion UnitedHealth buys LHC Group for $5.4 billion for home health care

DUSTIN JONES

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