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What: Shares of the acute hospitalist and post-acute care services company IPC Healthcare (NASDAQ:IPCM) gained over 40% today on exceptional volume after the company announced that it agreed to a $1.6 billion tender offer from TeamHealth Holdings. Per the terms of the deal, TeamHealth will pay $80.25 per share for IPC Healthcare in an all-cash deal, representing a 37% premium compared to where the company's share closed Monday. The deal is expected to close sometime in the fourth-quarter of this year, and immediately add to TeamHealth's 2016 earnings. 

So what: This buyout will greatly expand TeamHealth's medical staffing business, especially in the area of post-acute care. As a result, it should help to set the company up to better handle the ongoing transition to a value-based reimbursement system in the U.S. in the post-acute setting. 

Now what: This deal will greatly diversify TeamHealth's services, as well as its physician network. Most importantly, though, it gives the medical staffing company a strong growth platform moving forward. Prior to this buyout, IPC Healthcare was projected to post a 20% increase in earnings per share, on average, for the next five years, fueled mainly by its post-acute services.  

 

George Budwell has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.