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Dealipedia - The Blackstone Group acquires Apria Healthcare Group Inc

The Blackstone Group acquires Apria Healthcare Group Inc for $1.6 billion

Deal Participants:
Acquiring Company: The Blackstone Group View Profile Charts Homepage
Target Company: Apria Healthcare Group Inc View Profile Charts Homepage
Deal Financials:
Price: $1.6 billion
 
Date:
Announced: Jun 19, 2008

PRESS RELEASE

Apria Healthcare Group Inc. (NYSE:AHG), a leading home healthcare services company, today announced it has entered into a definitive merger agreement with an affiliate of The Blackstone Group (NYSE:BX) in a transaction valued at approximately $1.6 billion.

Under the terms of the merger agreement, Apria shareholders will receive $21.00 in cash for each outstanding share of common stock they hold. The $21.00 per share in cash purchase price represents a premium of approximately 33% over the closing share price on Wednesday, June 18, 2008, the last trading day prior to today's announcement, and a premium of approximately 29% over Apria's $16.22 average closing share price for the 30 trading days ended June 18, 2008.

The independent members of Apria's Board of Directors have unanimously approved the merger agreement and will recommend that Apria shareholders adopt the agreement.

The transaction will be financed through a combination of equity contributed by Blackstone and debt financing committed by affiliates of Bank of America, Wachovia and Barclays Capital. Upon completion of the merger, Apria will become a private company, wholly-owned by Blackstone and its affiliates. The transaction is expected to close in the second half of 2008, subject to customary closing conditions. The corporate headquarters of Apria Healthcare will remain in Lake Forest, California; its infusion division headquarters will remain in Denver, Colorado.

"After careful analysis, the Board has endorsed this transaction as being in the best interest of our shareholders," said Lawrence M. Higby, Chief Executive Officer and a Director of Apria Healthcare.

"We are excited about teaming up with Blackstone to continue pursuing our goals of growth while continually improving operating efficiencies and enhancing our service for all of the patients and customers we serve. We are delighted that a company with the resources and reputation of Blackstone recognizes the value inherent in the service-first approach that our associates across the country deliver every day. Blackstone brings an experienced group of long-term healthcare investors who are committed to reinforcing our company's mission of being our patients' and customers' first choice for homecare services in the United States."
The completion of the merger is subject to terms and conditions customary for transactions of this type, including approval by Apria's shareholders, termination or expiration of the Hart-Scott-Rodino regulatory waiting period and other customary closing conditions. Apria will solicit shareholder approval at a special meeting which is expected to occur as early as September 2008.

Under the merger agreement, Apria and its advisors are permitted and intend to solicit alternative acquisition proposals from third parties until July 24, 2008. After that date, Apria is not permitted to solicit alternate acquisition proposals and may only respond to certain unsolicited proposals prior to obtaining Apria shareholder approval. Apria advises that there can be no assurance that the solicitation of superior proposals will result in an alternative transaction. Apria does not intend to disclose developments with respect to this solicitation process unless and until its Board of Directors has made a decision regarding any alternative proposal. If Apria's Board accepts a superior proposal, the merger agreement would be terminated and Apria would be obligated to pay a break-up fee.

Goldman, Sachs & Co. acted as financial advisor to Apria's Board of Directors, and Gibson, Dunn & Crutcher LLP acted as legal advisor to Apria. Munger Tolles & Olson LLP acted as legal advisor to the independent members of Apria's Board of Directors. Banc of America Securities LLC, Wachovia Capital Markets, LLC and Barclays Capital acted as financial advisors and Simpson Thacher & Bartlett LLP acted as legal advisors to Blackstone.

Credit Facility

Apria also entered into a $280 million credit facility with affiliates of Bank of America, Wachovia and Barclays Capital. Proceeds of the new credit facility will be used to fund potential repurchases of Apria's 3.375% Convertible Senior Notes due 2033 and to pay certain tax liabilities related thereto.

About Apria Healthcare Group Inc.
Apria is a national provider of a broad range of home healthcare services and products including home infusion therapy, home respiratory therapy and home medical equipment. Through approximately 550 respiratory and infusion therapy locations serving patients in all 50 states, Apria and its operating divisions serve over two million patients per year. In addition to serving patients who are covered by government insurers, Apria has over 2,000 preferred provider contracts with managed care organizations nationwide. With over $1.6 billion in annual net revenues ($2.1 billion if Coram, which Apria acquired in December 2007, were included for the full year), it is the nation's leading home healthcare company. For more information, visit www.apria.com or www.coramhc.com.

About The Blackstone Group
Blackstone is one of the world's leading investment and advisory firms. They seek to create positive economic impact and long-term value for their investors, the companies they invest in, the companies they advise and the broader global economy. They do this through the commitment of extraordinary people and flexible capital. Blackstone's alternative asset management businesses include the management of corporate private equity funds, real estate funds, hedge funds, funds of funds, debt funds, collateralized loan obligation vehicles (CLOs) and closed-end mutual funds. The Blackstone Group also provides various financial advisory services, including mergers and acquisitions advisory, restructuring and reorganization advisory and fund placement service. Further information is available at www.blackstone.com.

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Jun 19 '08
This version submitted by beyondtheveil

 

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