Emergency Medical Services Corp. signed a definitive agreement to sell the publicly traded emergency transport and physician services company to private-equity firm Clayton, Dubilier & Rice for a market-discounted price of $3.2 billion, according to a news release from Emergency Medical. The transaction value also includes net debt and estimated transaction costs of approximately $300 million.
EMS Corp. to be sold in $3.2 billion deal
The deal was struck at $64 per share, which is 9% less than the $70.66 value of the stock at the close on Friday. William Sanger, Emergency Medical's chairman and CEO, said in an interview that the company's share price had risen more than 30% since the company announced Dec. 14 it was considering strategic alternatives to enhance shareholder value, with the stock price closing at $53.86 before that announcement. "We really believe we maximized shareholder value," Sanger said. Multiple bids were considered.
The company's ownership structure includes both A and B shares as well as limited partnership interests owned by Toronto-based investment firm Onex Corp. or its affiliates. According to Emergency Medical's most recent annual report, Onex controlled 82% of the company's voting power and effectively controlled the company.
Emergency Medical has two primary businesses, American Medical Response, a healthcare transportation company, including ground and air transport, and EmCare, which offers outsourced physician services for areas such as emergency departments, inpatient radiology and anesthesiology.
The transaction is expected to close in the second quarter subject to customary closing conditions, and Emergency Medical will not be issuing an earnings release or host a conference call to discuss its fourth-quarter earnings, according to the Emergency Medical release.
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