UnitedHealth Group's Optum to acquire dialysis-center chain DaVita for $4.9B

UnitedHealth Group's Optum to acquire dialysis-center chain DaVita for $4.9B

The deal with Denver-based DaVita is mainly to provide the services of dialysis, will combine UnitedHealth's Optum unit with DaVita's physician network business that serves about 1.7 million patients each year through almost 300 clinics.

UnitedHealth Group's health services company is set to add another acquisition to its trophy room.

The largest US health insurer UnitedHealth Group Inc will buy DaVita Inc's primary and urgent care services for $4.9 billion in its second acquisition this year to expand its fast-growing medical group, it said on Wednesday.

"Combining DaVita Medical Group and Optum advances our shared goal of supporting physicians in delivering exceptional patient care in innovative and efficient ways while working with more than 300 health care payers across Optum in ways that better meet the needs of their members", Optum CEO Larry C. Renfro said in a statement.

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The deal comes on the heels of this week's announcement that insurer Aetna will merge with CVS in a partnership that many believe will disrupt how healthcare is delivered in the country.

DaVita's 2,470 outpatient dialysis centers will become part of OptumCare. The company already operates medical practices in Southern California and elsewhere, and it owns almost 250 MedExpress urgent-care clinics.

With medical groups in California, Colorado, Florida, Nevada, New Mexico and Washington, the DaVita purchase will expand the market reach of Optum's strategic care delivery portfolio which also includes Surgical Care Affiliates, MedExpress and HouseCalls. Last month, the company told investors that it has medical groups in 30 markets, and a health-care provider presence in 60. At the time, HealthCare Partners was the largest US operator of physician groups and networks. DaVita attributed the unit's third-quarter result to higher-than-projected medical costs and other factors. This deal, which is expected to close in 2018, is aimed to help expand UnitedHealth's primary and urgent care services.

Also, DaVita is planning to use the proceeds of the sale for stock buybacks and to repay debt.