Ohio-based Cardinal Health is eyeing the acquisition of urology management services company Solaris Health for about $1.9 billion in cash.
Cardinal Health's multispecialty management services organization, The Specialty Alliance, announced it had entered into a definitive agreement to acquire Solaris Health, a urology MSO, from Lee Equity Partners and Solaris Health physician owners.
The global healthcare services and products company, which partners with and supplies various healthcare facilities, such as hospitals and ambulatory surgical centers, will provide the cash to The Specialty Alliance to enable the acquisition.
The acquisition is meant to fuel Cardinal Health's growth strategy by expanding the reach of The Specialty Alliance. Cardinal Health will own approximately 75% of The Specialty Alliance after its acquisition of Solaris Health.
"Accelerating Specialty growth remains our top priority," said Jason Hollar, CEO of Cardinal Health. "Urology is an attractive specialty for us, and we are well-positioned to meet the comprehensive needs of community urologists through the robust combined capabilities of The Specialty Alliance, Specialty Networks and Cardinal Health."
WHAT'S THE IMPACT
Solaris Health supports more than 750 providers across more than 250 practice locations in 14 states. Cardinal highlighted Solaris' broad array of revenue streams, resulting from a number of ancillary services and underpinned by a national MSO infrastructure.
Solaris Health physicians and several members of management will join GI Alliance physician owners and management as equity holders and operators in The Specialty Alliance. GI Alliance is a gastroenterology MSO, which Cardinal Health acquired last year for about $2.8 billion.
Dr. Gary Kirsh, Solaris Health CEO, will retire from his role and serve as a senior advisor to Cardinal Health.
"As a physician, I know firsthand that integrated, coordinated care is critical to improving outcomes," said Specialty Alliance CEO Dr. James Weber. "By bringing Solaris Health's leading urology network into our platform, we're helping specialty providers focus more of their time and energy where it matters most, on their patients."
The company expects the transaction to close by year-end. The transaction is expected to be slightly accretive to Cardinal Health's non-GAAP earnings per share in the first 12 months following close.
THE LARGER TREND
At the same time Cardinal Health acquired GI Alliance last fall, it also acquired Advanced Diabetes Supply Group (ADSG) for about $1.1 billion in cash. ADSG is one of the country's leading diabetic medical supply providers, and is merging with Cardinal Health's At-Home Solutions business.
And in September, the company entered into a definitive agreement to acquire Integrated Oncology Network, a physician-led independent community oncology network, for more than $1.1 billion in cash.
ION includes more than 50 practice sites in 10 states representing more than 100 providers. Its continuum of care includes medical oncology, radiation oncology, urology, diagnostic testing and other ancillary services.
Cardinal Health said the transaction was part of its effort to help community healthcare providers maintain their independence.
Email: jlagasse@himss.org
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