Optum, a leading health services company and part of UnitedHealth
Group (NYSE:UNH), and Surgical Care Affiliates, Inc. (NASDAQ:SCAI),
a leading ambulatory surgery center (ASC) and surgical hospital
provider, are combining. The agreement calls for the acquisition of
SCA’s outstanding common stock for $57.00 per share.
The combination of SCA with OptumCare, Optum’s primary and
urgent care delivery services business working with more than 80
health plans, will position the combined organization as a
comprehensive provider of ambulatory care services, while
continuing expansion of SCA’s network of ASCs and surgical
hospitals in partnership with leading health systems, medical
groups and health payers. The combination builds upon the two
companies’ successful ASC collaborations and expands OptumCare’s
capabilities in outpatient surgical procedures.
“Joining with OptumCare will enable us to better support and
empower independent physicians, helping them provide high-quality
care for their patients while making health care more
affordable. The combination of SCA and OptumCare is another
step forward toward our vision of becoming the partner of choice
for surgeons,” said Andrew Hayek, chairman and chief executive
officer of SCA. “We already have a strong relationship with
OptumCare, so we have seen firsthand that our cultures and
strategies are aligned and complementary.”
Larry C. Renfro, vice chairman of UnitedHealth Group and Optum
chief executive officer, said: “Combining SCA and OptumCare will
enable us to continue the transition to high-quality, high-value
ambulatory surgical care, partnering with the full range of health
systems, medical groups and health plans. We have an
incredibly high regard for SCA’s leadership and people, so we look
forward to working with them and our payer partners to implement
care models that reward independent surgeons and specialists for
quality and care efficiency.”
System-wide, SCA and its affiliates serve approximately 1
million patients per year in more than 30 states. The company
is a leader in partnering strategically with many health plans,
medical groups and health systems to align with physicians through
value-based payment models that reward quality, patient experience
and cost-efficiency.
With the combination, SCA will become part of the OptumCare
platform, which serves millions of consumers annually through
20,000 affiliated physicians and hundreds of care facilities. Hayek
and the SCA leadership team will continue forward as part of SCA
and the larger OptumCare platform. The companies will offer
compelling quality and value to patients and payers and support
independent doctors’ practices as eligible surgical cases (e.g.,
total joint replacements) continue to migrate to the ASC and
surgical hospital environments.
The agreement calls for the acquisition of SCA’s outstanding
common stock for a fixed price of $57.00 per share, to be funded
between 51 percent and 80 percent with UnitedHealth Group common
stock, with the final percentage to be determined at UnitedHealth
Group’s option and the remainder in cash. The transaction is
expected to close during the first half of 2017, subject to the
tender of a majority of SCA’s shares, regulatory approvals and
other customary closing conditions, and is expected to be neutral
to UnitedHealth Group’s outlook for adjusted net earnings per share
in 2017 and modestly accretive in 2018.
“Over the past eight years, we have had the great pleasure of
partnering with SCA as the business has transformed into a leader
in the health care services sector,” said Lead Independent Director
of SCA and Managing Partner of TPG Capital Todd B. Sisitsky. “We
believe this combination will create significant value for SCA's
patients and physician partners, and we look forward to the
combined company’s future success.” Affiliates of TPG Capital,
owning approximately 30 percent of the common stock of SCA, have
agreed to tender their shares as part of the offer.
About SCASCA (NASDAQ:SCAI), a leader in the
outpatient surgery industry, strategically partners with health
plans, medical groups and health systems across the country to
develop and optimize surgical facilities. SCA operates 205 surgical
facilities, including ambulatory surgery centers and surgical
hospitals, in partnership with approximately 3,000 physicians. For
more information on SCA, visit www.scasurgery.com.
About OptumOptum is a leading information and
technology-enabled health services business dedicated to helping
make the health system work better for everyone. With more than
100,000 people worldwide, Optum delivers intelligent, integrated
solutions that help to modernize the health system and improve
overall population health. Optum is part of UnitedHealth Group
(NYSE: UNH).
About UnitedHealth GroupUnitedHealth Group
(NYSE:UNH) is a diversified health and well-being company dedicated
to helping people live healthier lives and helping make the health
system work better for everyone. UnitedHealth Group offers a broad
spectrum of products and services through two distinct platforms:
UnitedHealthcare, which provides health care coverage and benefits
services; and Optum, which provides information and
technology-enabled health services. For more information, visit
UnitedHealth Group at www.unitedhealthgroup.com or follow
@UnitedHealthGrp on Twitter.
Cautionary Statement Regarding Forward Looking
Statements
This communication may contain statements that constitute
“forward-looking statements,” including, for example, information
related to UnitedHealth Group Incorporated (“UnitedHealth Group”),
Surgical Care Affiliates, Inc. (“SCA”) and the proposed acquisition
of SCA by UnitedHealth Group. Generally the words “believe,”
“expect,” “intend,” “estimate,” “anticipate,” “plan,” “project,”
“should” and similar expressions identify forward-looking
statements, which generally are not historical in nature. Such
statements reflect the current analysis of existing information and
involve substantial risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by
such statements. The following factors, among others, could cause
actual results to differ materially from those described in these
forward-looking statements: the possibility that various conditions
to the consummation of the UnitedHealth Group exchange offer and
mergers may not be satisfied or waived, including the receipt of
regulatory clearances related to the mergers; uncertainty as to how
many shares of SCA common stock will be tendered into the
UnitedHealth Group exchange offer; the risk that the UnitedHealth
Group exchange offer and mergers will not close within the
anticipated time periods, or at all; the failure to complete or
receive the anticipated benefits from UnitedHealth Group’s
acquisition of SCA; the possibility that the parties may be unable
to successfully integrate SCA’s operations into those of
UnitedHealth Group; such integration may be more difficult,
time-consuming or costly than expected; revenues following the
transaction may be lower than expected; operating costs, customer
loss and business disruption (including, without limitation,
difficulties in maintaining relationships with employees,
customers, clients, suppliers or physicians) may be greater than
expected following the transaction; the retention of certain key
employees at SCA may not be achieved; the parties may be unable to
meet expectations regarding the timing, completion and accounting
and tax treatments of the transactions; UnitedHealth Group and SCA
are subject to intense competition; factors that affect
UnitedHealth Group’s ability to generate sufficient funds to
maintain its quarterly dividend payment cycle; the effects of local
and national economic, credit and capital market conditions; and
the other risks and uncertainties relating to UnitedHealth Group
and SCA described in their respective Annual Reports on Form 10-K
for the fiscal year ended December 31, 2015, and in their
subsequent Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K, all of which are filed with the U.S. Securities and
Exchange Commission (the “SEC”) and available at www.sec.gov.
UnitedHealth Group and SCA assume no obligation to update the
information in this communication, except as otherwise required by
law. Readers are cautioned not to place undue reliance on these
forward-looking statements or information, which speak only as of
the date hereof.
Additional Information and Where to Find It
This communication relates to a pending business combination
transaction between UnitedHealth Group and SCA. The exchange offer
referenced in this communication has not yet commenced. This
communication is for informational purposes only and is neither an
offer to sell or exchange, nor a solicitation of an offer to buy or
exchange, any securities, nor shall there be any sale of securities
in any jurisdiction in which such offer, sale or exchange would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
UnitedHealth Group intends to file a registration statement on
Form S-4 related to the transaction with the SEC and may file
amendments thereto. UnitedHealth Group and a wholly-owned
subsidiary of UnitedHealth Group intend to file a tender offer
statement on Schedule TO (including a prospectus/offer to exchange,
a related letter of transmittal and other exchange offer documents)
related to the transaction with the SEC and may file amendments
thereto. SCA intends to file a solicitation/recommendation
statement on Schedule 14D-9 with the SEC and may file amendments
thereto. SCA and UnitedHealth Group may also file other documents
with the SEC regarding the transaction. This communication is not a
substitute for any registration statement, Schedule TO, Schedule
14D-9 or any other document which SCA or UnitedHealth Group may
file with the SEC in connection with the transaction. Investors and
security holders are urged to read the registration statement, the
Schedule TO (including the prospectus/offer to exchange, related
letter of transmittal and other exchange offer documents), the
solicitation/recommendation statement on Schedule 14D-9 and the
other relevant materials with respect to the transaction carefully
and in their entirety when they become available before making any
decision regarding exchanging their shares, because they will
contain important information about the transaction. The
prospectus/offer to exchange, the related letter of transmittal and
certain other exchange offer documents, as well as the
solicitation/recommendation statement, will be made available to
all holders of SCA’s stock at no expense to them. The exchange
offer materials and the solicitation/recommendation statement will
be made available for free at the SEC’s website at www.sec.gov.
Additional copies of the exchange offer materials and the
solicitation/recommendation statement may be obtained for free by
contacting UnitedHealth Group’s Investor Relations department at
(800) 328-5979. Additional copies of the
solicitation/recommendation statement may be obtained for free by
contacting SCA’s Investor Relations department at 800-768-0094.
In addition to the SEC filings made in connection with the
transaction, each of UnitedHealth Group and SCA files annual,
quarterly and current reports and other information with the SEC.
You may read and copy any reports or other such filed information
at the SEC public reference room at 100 F Street, N.E., Washington,
D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference room. UnitedHealth Group’s and
SCA’s filings with the SEC are also available to the public from
commercial document-retrieval services and at the website
maintained by the SEC at http://www.sec.gov.
Contacts:
For Optum:
Lauren Mihajlov
952-205-6312
lauren.mihajlov@optum.com
Tyler Mason
424-333-6122
tyler.mason@uhg.com
For SCA:
Alison Donnelly
847-420-3822
alison.donnelly@scasurgery.com
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