Home News Evolent Health To Buy IPG For $375 Mln Cash, Due At Close; Backs Outlook

Evolent Health To Buy IPG For $375 Mln Cash, Due At Close; Backs Outlook

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Jun 29, 2022 1:11AM EDT

(RTTNews) – Evolent Health, Inc. (EVH), a provider of clinical and administrative solutions, announced Wednesday that it has entered into a definitive agreement to acquire IPG, a provider of surgical cost management solutions.

IPG will be acquired from TPG Growth, the middle market and growth equity platform of alternative asset firm TPG, for $375 million in cash, due at close. In addition, contingent consideration of up to $87 million may be paid based on future performance milestones for IPG.

The transaction is expected to close during the third quarter of 2022 and is subject to customary closing conditions.

Following the deal closure, IPG team and platform will be integrated into New Century Health.

At closing, the IPG acquisition is expected to immediately enhance Evolent Health’s adjusted EBITDA margin and cash flow profile.

The deal expands Evolent’s specialty focus to include surgical cost management focusing on musculoskeletal conditions, adding to its specialty portfolio of oncology, cardiology, and end-of-life care planning.

For calendar year 2022, IPG standalone financials are expected to be revenue of $140 million, and adjusted EBITDA of $25 million or approximately 18% margin. Annual sales growth for IPG is expected to be 20%+.

Evolent expects to fund $250 million of the purchase price in cash, through a combination of $25 million cash on hand and proceeds from a new $225 million Five Year Senior Credit Facility provided by funds managed by the credit group of Ares Management.

The balance of the upfront consideration will be in the form of newly issued Evolent common shares.

Further, Evolent reaffirmed its outlook for the second quarter of 2022 and full year 2022 before the acquisition of IPG.

The company expects to provide updated full year guidance incorporating the acquisition on its second quarter, 2022 earnings report and conference call in early August, assuming the acquisition has closed by such time.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Source : Nasdaq

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NEWS7.ASIA :Evolent Health To Buy IPG For $375 Mln Cash, Due At Close; Backs Outlook
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news7.asia Evolent Health To Buy IPG For $375 Mln Cash, Due At Close; Backs Outlook