Apollo in advanced discussions to acquire LifePoint Health
Apollo Global (APO) is in advanced talks to buy LifePoint Health (LPNT), two people familiar with the matter told Reuters on Friday.
The deal could value LifePoint at nearly $6B, including debt, the sources said, adding that Apollo plans to combine LifePoint with RegionalCare Hospital Partners, another regional hospital operator that it owns.
If the negotiations are completed successfully, a deal could be announced as early as next week, the sources said, cautioning that it was possible talks could fail at the last minute. The sources asked not to be identified because the matter is confidential.
Rural healthcare providers such as LifePoint have been challenged in recent years because their reliance on federal insurers such as Medicare and Medicaid has made them particularly vulnerable to changing reimbursement programs. In addition, hospital operating costs have been rising faster than reimbursement rate increases.
Apollo, which raised a $24.6 billion private equity fund last year, acquired RegionalCare in 2015, and merged it with another hospital operator, Capella Healthcare, in 2016.
It would be by far the biggest acquisition for Apollo this year. LifePoint currently has a market capitalization of $1.9 billion and long-term net debt of $2.9 billion.
LPNT closed at $47.90.
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