UnitedHealth's (UNH) - Get Report pharmacy benefit manager, Optum Rx, has inked a $2.3 billion deal to acquire Surgical Care Affiliates (SCAI) amid a bevy of health care deals announced Monday morning at J.P. Morgan Healthcare Conference.
The deal, which valued Surgical Care at $57 per share, is expected to close in the first half of 2017 and to be funded in cash and stock. UnitedHealth will use between 51% and 80% in stock and fund the rest of the deal in cash.
Surgical's share price saw a huge boost on the news, rising 16.9% ahead of market's open Monday, hitting $56.99 per share.
Meanwhile, UnitedHealth barely moved ahead of market's open, falling 0.5% to $161.58 apiece.
Surgical Care was backed by TPG Capital for eight years. TPG will tender its 30% stake in the company as a part of the deal.
In 2013, Surgical Care acquired Health Inventures, a national surgical and physician services company for undisclosed terms. And in August, the company acquired a majority interest in Metropolitan Medical Partners, which does business as Surgery Center of Chevy Chase, for an undisclosed sum.
Steve Frank, Tom Monaghan and Craig Smart of JPMorgan Chase acted as financial adviser to Surgical Care on the deal. Paul Shim and Jim Langston at Cleary Gottlieb Steen & Hamilton and Dottie Pak of Bradley Arant acted as legal advisers. A Debevoise & Plimpton team led by Andrew Bab provided legal counsel to JPMorgan bankers Steve Franks, Tom Monaghan and Francesco Leuthold, which advised Surgical Care, on the deal.
Meanwhile, lawyer Tim Aragon of Hogan Lovells is representing UnitedHealth.
Cleary's Michael Ryan and David Lopez advised Surgical Care Affiliates on its 2013 IPO. J.P. Morgan was the lead book-runner on that public offering. Cleary often advises TPG Capital, and did so when the private equity shop bought HealthSouth Corp.'s surgery centers in 2007, from which TPG built Surgical Care.