Less Than 2 Years Post IPO, Signify Health Reportedly Considering Sale

Just a year and a half after going live on the public market, Signify Health Inc. (NYSE: SGFY) is reportedly exploring strategic alternatives, including a potential sale.

The report came from the Wall Street Journal initially, which cited “people familiar with the matter.” Those sources also said that the company could attract offers from managed care plans and private equity (PE) groups.

Neither would be a surprise, as insurers and PE firms have been supremely active in the home-based care space of late. The PE firm New Mountain Capital is already a Signify investor.


On the other hand, Signify considering a sale this soon after raising $564 million through the sale of 23.5 million shares in its early 2021 IPO is a surprise. The exploration of strategic alternatives is reportedly in early stages, however, and a sale is “far from guaranteed.”

The Dallas-based Signify is a tech-driven enabler and coordinator of at-home care. It works with both health plans and providers to help deliver that care, which is typically conducted under value-based care contracts.

The company made its first major splash on the public market when it acquired Caravan Health – an accountable care organization (ACO) manager – in February for $250 million.


It has recently dealt with a bit of a shakeup, however. In July, it announced that it would be exiting from the Centers for Medicare & Medicaid Services’ (CMS) Bundled Payments for Care Improvement-Advanced (BPCI-A) program. Instead, Signify CEO Kyle Armbrester said the company would turn its attention more toward its home-focused segment of business.

“We made this decision in partnership with our clients, who have repeatedly surpassed benchmarks for quality care and operational improvements with our support – including significant reductions in readmissions and increases in healthy days at home during an extremely challenging period for health care,” Armbrester said at the time.

The change came in wake of CMS adjusting its trend calculations, which lowered target prices of episodes and the opportunity for savings.

After Signify stock initially reached close to $40 per share around the time of the IPO, things have steadily declined. In June, the stock bottomed out at less than $12 per share. As of Wednesday, Signify was listed at $18.45 per share.

The company’s second-quarter earnings call is set for Thursday morning.

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