Astrana Health Announces Definitive Agreement to Acquire Certain Businesses and Assets of Prospect Health System
Astrana Health (NASDAQ: ASTH) has announced a definitive agreement to acquire Prospect Health for $745 million. The acquisition includes Prospect's health plan, medical groups across four states, management service organization, pharmacy, and a 177-bed hospital. Prospect's network includes approximately 3,000 primary care providers and 10,000 specialists, serving 610,000 members across Medicare Advantage, Medicaid, and Commercial lines.
The transaction is expected to close in mid-2025, funded through cash and a $1,095 million bridge commitment from Truist Bank and J.P. Morgan. Prospect is projected to generate $1.2 billion in revenue with adjusted EBITDA of $81 million for 2024.
Astrana Health (NASDAQ: ASTH) ha annunciato un accordo definitivo per acquisire Prospect Health per 745 milioni di dollari. L'acquisizione include il piano sanitario di Prospect, gruppi medici in quattro stati, un'organizzazione di servizi di gestione, una farmacia e un ospedale con 177 posti letto. La rete di Prospect comprende circa 3.000 fornitori di cure primarie e 10.000 specialisti, servendo 610.000 membri attraverso Medicare Advantage, Medicaid e linee commerciali.
Si prevede che la transazione si chiuda a metà del 2025, finanziata tramite contante e un impegno di bridge di 1.095 milioni di dollari da Truist Bank e J.P. Morgan. Si prevede che Prospect genererà 1,2 miliardi di dollari di entrate con un EBITDA rettificato di 81 milioni di dollari per il 2024.
Astrana Health (NASDAQ: ASTH) ha anunciado un acuerdo definitivo para adquirir Prospect Health por 745 millones de dólares. La adquisición incluye el plan de salud de Prospect, grupos médicos en cuatro estados, una organización de servicios de gestión, una farmacia y un hospital de 177 camas. La red de Prospect incluye aproximadamente 3.000 proveedores de atención primaria y 10.000 especialistas, atendiendo a 610.000 miembros a través de Medicare Advantage, Medicaid y líneas comerciales.
Se espera que la transacción se cierre a mediados de 2025, financiada a través de efectivo y un compromiso de puente de 1.095 millones de dólares de Truist Bank y J.P. Morgan. Se proyecta que Prospect generará 1.2 mil millones de dólares en ingresos con un EBITDA ajustado de 81 millones de dólares para 2024.
아스트라나 헬스 (NASDAQ: ASTH)는 프로스펙트 헬스를 7억 4천5백만 달러에 인수하기 위한 확정 계약을 발표했습니다. 이 인수에는 프로스펙트의 건강 계획, 네 개 주의 의료 그룹, 관리 서비스 조직, 약국 및 177병상 병원이 포함됩니다. 프로스펙트의 네트워크에는 약 3,000명의 1차 진료 제공자와 10,000명의 전문의가 있으며, 메디케어 어드밴티지, 메디케이드 및 상업 라인을 통해 61만 명을 서비스하고 있습니다.
이 거래는 2025년 중반에 마감될 것으로 예상되며, 현금과 Truist 은행 및 J.P. 모건으로부터의 10억 9천5백만 달러의 다리 대출로 자금을 조달합니다. 2024년에는 프로스펙트가 12억 달러의 수익을 창출하고 조정 EBITDA는 8,100만 달러에 이를 것으로 예상됩니다.
Astrana Health (NASDAQ: ASTH) a annoncé un accord définitif pour acquérir Prospect Health pour 745 millions de dollars. L'acquisition comprend le plan de santé de Prospect, des groupes médicaux dans quatre États, une organisation de services de gestion, une pharmacie et un hôpital de 177 lits. Le réseau de Prospect comprend environ 3 000 fournisseurs de soins primaires et 10 000 spécialistes, servant 610 000 membres à travers Medicare Advantage, Medicaid et des lignes commerciales.
La transaction devrait se clore à la mi-2025, financée par des liquidités et un engagement de pont de 1 095 millions de dollars de Truist Bank et J.P. Morgan. Prospect devrait générer 1,2 milliard de dollars de revenus avec un EBITDA ajusté de 81 millions de dollars pour 2024.
Astrana Health (NASDAQ: ASTH) hat eine endgültige Vereinbarung zur Übernahme von Prospect Health für 745 Millionen Dollar angekündigt. Die Übernahme umfasst den Gesundheitsplan von Prospect, medizinische Gruppen in vier Bundesstaaten, eine Management-Service-Organisation, eine Apotheke und ein Krankenhaus mit 177 Betten. Das Netzwerk von Prospect umfasst rund 3.000 Anbieter von Primärversorgung und 10.000 Spezialisten, die 610.000 Mitglieder in den Bereichen Medicare Advantage, Medicaid und kommerzielle Leistungen bedienen.
Die Transaktion wird voraussichtlich Mitte 2025 abgeschlossen, finanziert durch Bargeld und ein Brückenengagement über 1.095 Millionen Dollar von Truist Bank und J.P. Morgan. Es wird erwartet, dass Prospect im Jahr 2024 einen Umsatz von 1,2 Milliarden Dollar bei einem bereinigten EBITDA von 81 Millionen Dollar generiert.
- Significant expansion adding 610,000 members to reach 1.7 million total members
- Addition of 3,000 primary care providers and 10,000 specialists to network
- Expected $1.2 billion revenue contribution from Prospect in 2024
- Projected $81 million in adjusted EBITDA from acquisition
- Geographic expansion into new markets including Orange County
- Large debt financing required with $1,095 million bridge commitment
- Extended closing timeline to mid-2025
- Significant integration risks across multiple states
- Substantial capital investment needed for infrastructure improvements
Insights
This is a significant strategic acquisition that substantially expands Astrana Health's market presence. The
The transaction will be financed through a combination of cash and a
This acquisition marks a substantial consolidation in the managed care space, creating a combined network of over 13,000 healthcare providers serving approximately 1.7 million members. The integration of Prospect's diverse portfolio - including a health plan, medical groups across four states, MSO operations and a 177-bed hospital - significantly enhances Astrana's vertical integration strategy.
The deal strengthens Astrana's position in key markets and diversifies its revenue streams across Medicare Advantage, Medicaid and Commercial lines. The emphasis on technology-driven care delivery and local market presence aligns with industry trends toward value-based care models. The planned infrastructure investments signal a commitment to quality improvement and market expansion.
Prospect is an integrated care delivery system which facilitates and coordinates the delivery of high-quality clinical care for all. With a network of around 3,000 primary care providers and 10,000 specialists across
"The acquisition of Prospect would represent the combination of two organizations with decades-long histories of enabling independent providers and coordinating the delivery of high-quality care for all. We believe that our organizations share a common culture of patient centricity and a shared mission to provide high-quality care tailored to local communities," said Brandon K. Sim, President and CEO of Astrana.
"This strategic transaction will significantly expand our provider network and enhance our ability to offer increased access, quality, and value for our members. Prospect's established presence in key markets also opens new opportunities for Astrana, particularly in geographically adjacent
Jim Brown, CEO of Prospect, said, "We are excited at the opportunity to partner with Astrana to build a larger, stronger, and more coordinated care delivery network which we expect will benefit our communities by increasing access, quality, value, and efficiency. We believe the strong cultural alignment, cohesive missions, and clear financial and operational synergies between our companies make Astrana the ideal partner for us. We look forward to working together to further our joint mission of delivering high-quality, affordable, and accessible care for all."
Astrana plans to make significant investments in Prospect and its infrastructure in order to further enhance access and quality of care for patients in local communities. The partnership between Astrana and Prospect will help ensure that healthcare remains local and personalized for patients across four states.
Additional details regarding Astrana's planned acquisition of Prospect can be found on the Company's Investor Relations website.
Transaction Details
Under the terms of the agreement, subject to satisfaction of customary conditions, Astrana plans to acquire the Prospect businesses and assets for a purchase price of
Prospect is expected to generate approximately
Astrana's acquisition of Prospect is expected to close in the middle of 2025, subject to regulatory approval and other customary closing conditions.
Advisors
J.P. Morgan Securities LLC is serving as exclusive financial advisor to Astrana, and Russ August & Kabat LLP is serving as legal advisor for Astrana. Morgan Stanley & Co. LLC is serving as lead financial advisor to Prospect, and Sheppard,
Conference Call and Webcast Information:
Astrana will host a conference call at 5:30 a.m. PT/8:30 a.m. ET today (Friday, November 8, 2024), during which management will discuss the details of the transaction. To participate in the conference call, please use the following dial-in numbers about 5 minutes prior to the scheduled conference call time:
International (Toll): +1 (201) 689-8517
The conference call can also be accessed via webcast at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=26JyTYKy.
An accompanying slide presentation will be available in PDF format on the "IR Calendar" page of the Company's website (https://ir.astranahealth.com/news-events/ir-calendar) after issuance of the press release and will be furnished as an exhibit to Astrana's current report on Form 8-K to be filed with the SEC, accessible at www.sec.gov.
Those who are unable to attend the live conference call may access the recording at the above webcast link, which will be made available shortly after the conclusion of the call.
About Astrana Health, Inc.
Astrana is a leading provider-centric, technology-powered healthcare company enabling providers to deliver accessible, high-quality, and high-value care to all. Leveraging its proprietary end-to-end technology solutions, Astrana operates an integrated healthcare delivery platform that enables providers to successfully participate in value-based care arrangements, thus empowering them to deliver high quality care to patients in a cost-effective manner.
Headquartered in
Forward Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. These statements include words such as "forecast," "guidance," "projects," "estimates," "anticipates," "believes," "expects," "intends," "may," "plans," "seeks," "should," or "will," or the negative of these words or similar words. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in each such statement. A number of important factors could cause actual results to differ materially from those included within or contemplated by the forward-looking statements, including, but not limited to, risks arising from the diversion of management's attention from the Company's ongoing business operations, an increase in the amount of costs, fees and expenses and other charges related to the acquisition described in this press release, outcome of any litigation that the Company or Prospect may become subject to relating to such acquisition, the extent of, and the time necessary to obtain, any regulatory approvals required for completion of the acquisition, risks of disruption to the Company's business as a result of the public announcement of the acquisition, the occurrence of any event, change or other circumstance that could give rise to the termination of the agreements relating to the acquisition, an inability to complete the acquisition in a timely manner or at all, including due to a failure of any condition to the closing of the acquisition to be satisfied or waived by the applicable party, the occurrence of any event, change or other circumstance that could give rise to the termination of any of the agreements to the acquisition, a decline in the market price for the Company's common stock if the acquisition is not completed, risks that the acquisition disrupts current plans and operations of the Company or Prospect and potential difficulties in Prospect's employee retention as a result of the acquisition, the Company's ability to successfully obtain funding of, and pay the interest and principal on, the Bridge Facility provided for in the Commitment Letter, and the ability to implement business plans, forecasts and other expectations after the completion of the acquisition, realize the intended benefits of the acquisition, and identify and realize additional opportunities following the acquisition, as well as the other risks and uncertainties identified in filings by the Company with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as may be amended or supplemented by additional risk factors set forth in subsequent quarterly reports on Form 10-Q and other reports filed with the Securities and Exchange Commission. The Company does not undertake any responsibility to update any of these factors or to announce publicly any revisions to any of the forward-looking statements contained in this or any other document, whether as a result of new information, future events, or otherwise, except as may be required by any applicable securities laws.
Pro Forma Measures
This press release includes pro forma information that gives effect to the consummation of the acquisition. The combined company forward-looking financial data are for illustrative purposes only and should not be relied on as necessarily being indicative of future results. The assumptions and estimates underlying the combined company forward-looking financial data are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the prospective financial information, including those under "Forward Looking Statements" above. Combined company forward-looking financial data is inherently uncertain due to a number of factors outside of the Company's or Prospect's control. Accordingly, there can be no assurance that the prospective results are indicative of future performance of the combined company after completing the proposed acquisition or that actual results will not differ materially from those presented in the combined company forward-looking financial data. Inclusion of combined company forward-looking financial data in this press release should not be regarded as a representation by any person that the results contained in the prospective financial information will be achieved. Readers are cautioned not to place undue reliance on the pro forma combined company financial information.
Use of Non-GAAP Financial Measures
This press release contains the non-GAAP financial measure Adjusted EBITDA, of which the most directly comparable financial measure presented in accordance with
The Company believes the presentation of this non-GAAP financial measure provides investors with relevant and useful information, as it allows investors to evaluate the operating performance of the business activities without having to account for differences recognized because of non-core or non-recurring financial information. When GAAP financial measures are viewed in conjunction with non-GAAP financial measures, investors are provided with a more meaningful understanding of the Company's ongoing operating performance. In addition, this non-GAAP financial measure is among those indicators the Company uses as a basis for evaluating operational performance, allocating resources, and planning and forecasting future periods. Non-GAAP financial measures are not intended to be considered in isolation, or as a substitute for, GAAP financial measures. Other companies may calculate Adjusted EBITDA differently, limiting the usefulness of this measure for comparative purposes. The Company has not provided a quantitative reconciliation of the projected adjusted EBITDA in 2024 for Prospect to the most comparable GAAP measure, net income, on a forward-looking basis within this press release because the Company is unable, without unreasonable efforts, to provide reconciling information with respect to certain line items that cannot be calculated. These items, which could materially affect the computation of forward-looking GAAP net income, are inherently uncertain and depend on various factors, some of which are outside of the Company's control.
FOR MORE INFORMATION, PLEASE CONTACT:
Investor Relations
(626) 943-6491
Asher Dewhurst, ICR Westwicke
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SOURCE Astrana Health, Inc.
FAQ
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