UnitedHealth Group Inc. (UNH) is in the running for Tenet Healthcare Corp.'s (THC) healthcare management subsidiary Conifer in a deal that could be valued at $2 billion, according to published reports.
A story in the online edition of The Wall Street Journal citing people familiar with the matter reported late Wednesday that it's not known who the other potential suitors are for Conifer, a business which accounted for 8% of Tenet's revenue last year. The report also noted there's no certainty UnitedHealth will make a deal for Conifer, and that Tenet may not sell the business.
On Tuesday, UnitedHealth reported second-quarter earnings that came in above estimates and revenue that was in line with expectations. The Minnetonka, Minn.-based firm also raised its outlook. UnitedHealth Group includes healthcare benefits provider UnitedHealthcare and health services business Optum.
According to the Journal report, a possible difficulty in a deal for Conifer is that hospital operators might not want to work with Conifer if it becomes part of Optum because of competition related to Optum's surgery and clinic centers. There are also concerns related to UnitedHealth's insurance segment, UnitedHealthcare, according to the report.