Envision Healthcare, AmSurg to Merge

CAL/AAEM News Service calaaem.news.service1 at gmail.com
Wed Jun 22 14:44:41 PDT 2016



June 15, 2016


Envision Healthcare, AmSurg to Merge 



The Wall Street Journal



By Dana Cimilluca and Dana Mattioli


Envision Healthcare Holdings Inc. and AmSurg Corp. agreed to merge, in a
deal that will create a company providing a range of hospital-related
services worth some $10 billion.


The all-stock deal has a fixed exchange ratio of 0.334 AmSurg share per
Envision share, the companies confirmed in a statement. Envision
shareholders will own about 53% of the combined company, which is to be
named Envision Healthcare Corp. It will have dual headquarters in Nashville,
Tenn., and Greenwood Village, Colo.


Shares of Envision fell by about 7% at one point after closing at $27.51
following a Journal report that the deal had been agreed to, while AmSurg
rose about 2% after closing at $77.50. The moves likely reflect the fact
that the deal is structured more like a merger than a takeover of Envision,
as some investors had expected. Envision had a market capitalization as of
Wednesday's close of about $5.2 billion, while AmSurg was valued at about
$4.3 billion.


The combined company will be led by Envision Chairman and Chief Executive
William Sanger, who will become executive chairman, and AmSurg CEO
Christopher Holden, who will maintain that role. The new board will have 14
directors, split evenly between their current board members, including
Messrs. Sanger and Holden.


AmSurg, of Nashville, provides outsourced physician services to hospitals
and others. It is also a big player in so-called ambulatory surgery, with
about 250 facilities performing procedures that don't require an overnight
stay. Envision, based in Greenwood Village, also provides physician services
such as emergency care, anesthesiology and surgery, in addition to ambulance
and other medical-transportation services.


The companies together had revenue of more than $8.5 billion in the 12
months ended in March. The companies said they would reap $100 million of
cost and other benefits from the combination within three years.


Consolidation waves have swept through the hospital and health-insurance
industries in recent years, part of a broader surge in deal making. That has
put pressure on companies like AmSurg to seek tie-ups that will enable them
to maintain size and scope needed to keep up with customers, rivals and


Last year, AmSurg made an unsolicited approach to combine with rival Team
Health Holdings Inc. AmSurg withdrew its offer after Team Health said it was
too low. In 2014AmSurg bought physician-outsourcing service provider
Sheridan Healthcare Inc. for about $2.3 billion.


The Envision-AmSurg deal is expected to close by year-end and is subject to
approval by regulators and the companies' shareholders.




Jeff Wells
Deputy Editor, CAL/AAEM News Service


Brian Potts MD, MBA
Managing Editor, CAL/AAEM News Service

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