KKR to Acquire Envision Healthcare

KKR to Acquire Envision Healthcare

Envision Healthcare has agreed to be acquired by KKR in an all-cash transaction for approximately $9.9 billion.

Envision Healthcare (NYSE: EVHC) is one of the largest providers of physician staffing services for emergency departments and hospitalists, anesthesiology, radiology and tele-radiology, and children’s services. The company also owns and operates 261 surgery centers and one surgical hospital in 35 states with medical specialties ranging from gastroenterology to ophthalmology and orthopedics.

Envision also provides medical transportation services in 41 states. Customers of Envision include health systems, payors, providers, and patients. The company, led by CEO Christopher Holden, was founded in 1992 and is based in Nashville (www.evhc.net).

Envision began reviewing strategic alternatives, including a sale of the company, on November 1, 2017. During the last seven months, the company examined a number of options to generate shareholder value which included changes to its capital structure, potential acquisitions, and a sale of the whole company. Envision was approached by 25 potential buyers, including financial sponsors and strategic entities. The transaction with KKR represents a multiple of 10.9x trailing 12 months Adjusted EBITDA and 10.1x 2018 anticipated Adjusted EBITDA.

“Envision is a leading provider of physician-led services in a health care system in which physician-patient interactions have a pronounced impact on nearly all health care decisions. Envision has a very strong reputation for delivering high-quality, patient-focused care through its network of 25,000 clinical professionals at thousands of hospitals, surgery centers and alternate sites of care across the country,” said Jim Momtazee, Head of KKR’s Health Care investment team. “We are excited to partner with the outstanding team led by Chris Holden to help build upon the strong foundation in place and accelerate Envision’s growth going forward.”

KKR (NYSE: KKR) makes private equity, fixed income and other investments in companies in North America, Europe, Asia and the Middle East.  The firm has $176 billion in assets under management. KKR was founded in 1976 and in addition to its New York headquarters has offices in 19 cities around the world (www.kkr.com).

The buy of Envision by KKR will be funded through KKR Americas Fund XII LP and is expected to close during the fourth quarter of 2018.

Fully committed debt financing for the transaction will be provided by Citigroup Global Markets, Credit Suisse, Morgan Stanley, Barclays, Goldman Sachs, Jefferies, UBS Investment Bank, RBC Capital Markets, HSBC, Mizuho, and KKR Capital Markets.

J.P. Morgan Securities, Evercore, and Guggenheim Securities are the financial advisors to Envision.

© 2018 Private Equity Professional | June 11, 2018

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