Why Chindex (CHDX) Hit a Five-Year High Today

NEW YORK (TheStreet) -- Chindex  (CHDX) spiked to a five-year high of $19.71 on Tuesday after the announcement that TPG and Shanghai Fosun Pharmaceutical would acquire the drug manufacturer.

The deal is worth $369 million, and the consortium will pay $19.50 per share in cash for Chindex. Founder and Chief Executive Officer Roberta Lipson will stay on as CEO after the deal.

"Bringing in the expertise of TPG and Fosun will be a win for our existing business, our expansion plans and the patients and communities we serve and hope to serve," Lipson said in the company's statement. "Over the last 15 years, Chindex has built its United Family Healthcare network into a premium brand, but we believe that new partners and committed financing are needed to achieve the next phases of these plans, including new facilities in our current service locations as well as significant geographic expansion. Together with Fosun and TPG, we will be able to continue developing our capabilities to offer comprehensive healthcare services of the highest quality across the entire life cycle of our patients."

The deal should give TPG and Fosun a foothold in China's private healthcare sector, which has been growing quickly as the Chinese government invests in it to alleviate pressure on public hospitals and to drive down prices through more competition in the market.

Must Read: Chindex International, Inc. Shareholder Alert: Bernstein Liebhard LLP Announces Investigation Of Acquisition By TPG And Fosun Pharma

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