Knoxville, Tenn.-based TeamHealth Holdings Inc. (NYSE: TMH), a leading physician services organization, said it agreed to be acquired by New York private equity firm Blackstone Group (NYSE: BX) and certain co-investors in a deal valued at $6.1 billion.
TeamHealth is a hospital staffing and outsourcing company, focused on emergency medicine, radiology, anesthesia, critical care and pediatrics, with the support of over 19,000 clinicians.
Under the deal, which has been unanimously approved by TeamHealth’s board, Blackstone and its co-investors will acquire TeamHealth for $43.50 per share in cash. This represents a premium of 33 percent over TeamHealth’s closing share price on October 3, 2016, the last trading day prior to news reports that it was considering a possible sale of the company.
Activist investor Jana Partners LLC, which had disclosed an 8 percent stake in the company earlier this year, agreed to vote its shares in favor of the deal.
“We are pleased to reach this agreement with Blackstone, which maximizes value for all TeamHealth stockholders,” said Leif Murphy, president and chief executive of TeamHealth.
Neil Simpkins, a senior managing director at Blackstone, commented, “We are thrilled to have the opportunity to invest in TeamHealth and once again partner with such an experienced management team and high quality business.”
“As a prior owner of TeamHealth, Blackstone knows TeamHealth and the U.S. healthcare industry well and will work with us to create value for all our stakeholders over the long-term,” said Lynn Massingale, MD, co-founder and executive chairman of TeamHealth.
The deal is subject to TeamHealth stockholder approval, regulatory approvals and other customary closing conditions, and is expected to close in the first quarter of 2017.
The transaction has fully committed financing and is not subject to any condition with regard to financing. Following completion of the transaction, TeamHealth will become a privately held company, wholly owned by funds affiliated with Blackstone, and will no longer be traded on the New York Stock Exchange.
Blackstone is one of the world’s leading investment firms, with over $360 billion in assets under management.
Goldman, Sachs & Co. is acting as lead financial advisor and Citi is acting as co-financial advisor to TeamHealth. Simpson Thacher & Bartlett LLP is acting as TeamHealth’s legal counsel.
BofA Merrill Lynch is acting as advisor to Blackstone on the transaction. Kirkland & Ellis LLP and Ropes & Gray LLP are acting as Blackstone’s legal counsel.
Photo: Stephen Schwarzman, Chairman, CEO & Co-Founder, Blackstone.