Over 27 million of LHC Group’s (Nasdaq: LHCG) 31 million shareholders participated in a vote Tuesday regarding the company’s pending deal with UnitedHealth Group (NYSE: UNH) and its subsidiary Optum. The move was first announced in March.
Those shareholders overwhelmingly approved UnitedHealth Group’s pending acquisition of LHC Group, another big and necessary step in a process that the two companies hope to complete in the second half of this year.
As part of the deal, UnitedHealth Group is set to pay $5.5 billion for LHC Group. Specifically, it’s set to pay for the company’s common stock at $170 per share. For context, at close on Wednesday, LHC Group’s stock was just above $159 per share. At the time the deal was announced, it was at $168 per share.
Since the announcement, UnitedHealth Group and Optum have commented on it publicly, but LHC Group has yet to do so.
But a recent SEC filing from May also has shone light on how the deal came about in the first place. In fact, it appears LHC Group had considered a potential sale as early as November of last year, according to the filing.
“LHC requested that SVB Securities and Jefferies, in an informal capacity, begin contacting potential strategic partners about the possibility of a potential transaction with LHC, and subsequently formally engaged Jefferies and SVB Securities as LHC’s financial advisors in connection with a potential transaction,” the SEC filing indicated. “In late November 2021, representatives of Jefferies contacted a representative of UnitedHealth Group to discuss UnitedHealth Group’s potential interest in the home health and hospice sector and a transaction or other strategic partnership with LHC.”
As part of the pending deal, LHC Group CEO and board chair Keith Myers will move into the role of CEO emeritus and senior adviser to Optum, also according to the May filing. Current LHC Group President and COO Josh Proffitt will become CEO.
The Lafayette, Louisiana-based LHC Group delivers home health, hospice and home- and community-based services, as well as facility-based care, across 37 states and the District of Columbia. It employs about 30,000 individuals.
Optum Health, which LHC Group will be integrated into if the deal holds, already has addressed its vision for a combined company.
“Now, we’ll be able to take the skills and offering of LHC Group and offer them to Optum Health patients much, much more broadly,” Optum Health CEO Dr. Wyatt Decker explained in a video posted online in March. “We have over 4 million patients in value-based arrangements, and we’re very excited to be able to offer the services of LHC Group to these individuals.”
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