Brentwood, Tenn.-based Surgery Partners, a leading ASC operator, has caught the eye of investors amid consistent growth and rumors of potential buyouts, according to a recent analysis from Seeking Alpha.
Here are 10 key points to know:
1. According to the analysis, Surgery Partners completed $225 million in acquisitions across 16 deals in 2023, $245 million in 13 transactions in 2022 and $325 million in 12 deals in 2021.
2. The company reported earnings before interest, taxes, depreciation and amortization of $118.3 million, an 18.1% year-over-year increase.
3. Surgery Partners raised its full-year guidance, now projecting more than $3 billion in revenue and over $508 million in adjusted EBITDA.
4. At the end of the first half of 2024, Surgery Partners had just under $215 million in cash and marketable securities. The company has been lowering its net leverage and is targeting at least $200 million in free cash flow by 2025.
5. Currently, Surgery Partners has 17 de novo projects in development and more than $100 million in submitted offers for future deals.
6. The company has forged strategic partnerships with Intermountain Health, Methodist Health System, and OhioHealth.
7. The company operates a network of more than 200 locations across 33 states and employs more than 4,600 affiliated physicians. As of June 30, Surgery Partners' ASC network consists of 167 facilities.
8. Several groups — including UnitedHealth Group, Optum's parent company — are vying to acquire Surgery Partners. A deal with UnitedHealth is reportedly in its early stages. Private equity firm TPG is another group competing to purchase the company.
9. If TPG acquires Surgery Partners, the firm is expected to make smaller "bolt-on" acquisitions to expand market share in the fragmented ASC sector. According to theSeeking Alpha report, TPG would likely add some debt to leverage the company, enabling a special payout to lower the equity at risk — a common private equity practice.
10. If UnitedHealth completes the acquisition, it would likely steer some of its insured customer base toward Surgery Partners' short-stay surgical facilities, which offer lower costs than traditional hospital-based surgical centers.