Humana to sell 60% stake in Kindred hospice, personal care units to CD&R
US health insurance company Humana has agreed to sell a 60% stake in the hospice and personal care units of its Kindred at Home subsidiary (KAH Hospice) to Clayton, Dubilier & Rice (CD&R) for around $2.8 billion.
The units involved in the sale include patient-centered services for hospice, community, palliative, and personal care.
Previously, Humana had revealed its intent to sell a majority stake in these non-core business units when it took full ownership of Kindred at Home last year.
Susan Diamond — Chief Financial Officer of Humana said: “We explored a broad range of alternatives and believe this transaction best allows Humana to divest majority ownership of these non-core businesses today, while still maintaining a strategic minority interest through our remaining stake.
“With CD&R’s established physician relationships, value-based care expertise, and record of providing strategic capital to a wide range of businesses, we are certain that these divisions are well-positioned for success under the joint ownership of Humana and CD&R.”
Humana to sell 60% stake in Kindred hospice, personal care units to CD&R. Photo courtesy of Andrzej Rembowski from Pixabay.
Humana plans to use the proceeds from the sale for repaying debt and repurchasing shares.
After the closing of the deal, the hospice and personal care divisions will be restructured into an independent operation.
David Causby, the incumbent president and CEO of KAH’s Hospice and Personal Care units, will continue to head them under the new structure.
David Causby said: “We are excited by the new strategic partnership structure with Humana and look forward to working closely with CD&R to pursue growth that is centered on improved access, equity and quality of care across an expanded group of patients.
“We share a common set of values and, like the CD&R team, are focused on driving quality care for patients and continuing to ensure that our company remains an employer of choice for health care professionals.”
The deal, which is subject to state and federal regulatory approvals, is anticipated to close in Q3 2022.