Apollo to buy LifePoint in latest private equity bet on healthcare
By Tamara Mathias (Reuters) - Apollo Global Management will buy LifePoint Health in a $5.6 billion deal that will expand its rural U.S. hospitals business, the latest in a series of bets by private equity firms on healthcare
By Tamara Mathias
(Reuters) - Apollo Global Management will buy LifePoint Health in a $5.6 billion deal that will expand its rural U.S. hospitals business, the latest in a series of bets by private equity firms on healthcare.
The deal comes as Tennessee-based LifePoint and many of its peers face higher medical costs, fewer patient admissions and changes to reimbursement policies in Medicare and Medicaid that have pressured profits.
To compensate, LifePoint has been beefing up its presence in rural regions including in Pennsylvania and Tennessee, and streamlining operations at healthcare facilities there.
The deal will bring together LifePoint and Apollo's RCCH HealthCare Partners, LifePoint said in a statement, confirming a Reuters report on Friday that the parties were in advanced talks for a buyout.
Apollo's deal - its biggest this year - is the latest in a recent surge of public investments by U.S. private equity, the highest since the 2007-08 global financial crisis.
With a record $1 trillion in cash at their disposal, top private equity names have turned to healthcare. Just last month, KKR and Veritas Capital each snapped up publicly-listed healthcare firms in multi-billion dollar deals.
Indeed, hospital operators are alluring to investors, Cantor Fitzgerald analyst Joseph France said. Because their operations are largely U.S.-based, hospital firms benefit more from lower tax rates than the average U.S. company, and are also more insulated from global trade uncertainties, France said.
Apollo's transaction value includes $2.9 billion of LifePoint's net debt and minority interest. The combined company will be led by current LifePoint Chief Executive Officer William Carpenter III.
LifePoint shares — down some 27 percent in the past year — jumped nearly 34 percent to $64 in premarket trading, $1 shy of Apollo's all-cash offer price.
Barclays, Citigroup, RBC Capital Markets and Credit Suisse will finance Apollo's acquisition. PSP Investments Credit USA LLC and an affiliate of Qatar Investment Authority will also provide part of the debt financing.
LifePoint will accept competing bids until Aug. 22, it said.
(Reporting by Tamara Mathias in Bengaluru; Editing by Sai Sachin Ravikumar)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.