cencora to acquire retina consultants of america in 4.6 billion deal

Cencora, formerly known as AmerisourceBergen, has announced its plan to acquire Retina Consultants of America (RCA) in a $4.6 billion deal. This acquisition aims to enhance Cencora's specialty drug business by integrating RCA's extensive network of retina specialists. The goal is to strengthen Cencora's relationships with community providers and position the company as a leader in specialty services.

Acquisition of Retina Consultants of America

Cencora, under the leadership of President and CEO Bob Mauch, is set to acquire Retina Consultants of America (RCA) in a $4.6 billion deal. This strategic move will bolster Cencora's specialty drug business by leveraging RCA's vast network of retina specialists. By integrating RCA, Cencora aims to solidify its position as a frontrunner in specialty services and enhance the overall provider experience.

The acquisition of RCA, a renowned management services organization (MSO) in the retina space, is expected to drive innovation in research and improve patient outcomes. With nearly 300 retina specialists across 23 states, RCA operates a premier clinical research network with 40 clinical trial sites and a dedicated team of 400 full-time research employees.

Enhancing Value Proposition

Cencora's acquisition of RCA is part of its broader strategy to enhance its value proposition to physicians and manufacturers in the specialty sector. The integration of RCA will not only broaden Cencora's capabilities but also strengthen its relationships with community providers.

Furthermore, Cencora's recent investment in OneOncology expands its MSO solutions, creating differentiated value across the healthcare system. By leveraging its manufacturer services, Cencora plans to enhance RCA's research program and outcomes, further solidifying its position as a leader in the specialty sector.

Financial Structure and Outlook

The financial structure of the acquisition involves approximately $4.6 billion in cash, with RCA's affiliated practices, physicians, and management retaining a minority interest in the organization. Cencora plans to fund the transaction through a combination of existing cash reserves and new debt financing.

The acquisition is projected to be approximately $0.35 accretive to Cencora's adjusted diluted earnings per share (EPS) for the first 12 months. This optimistic outlook highlights the potential value and growth opportunities that the partnership with RCA brings to Cencora.

Advisory and Legal Support

Lazard is serving as Cencora's exclusive financial adviser, while legal support is being provided by Freshfields LLP, Sidley Austin LLP, and Morgan, Lewis & Bockius LLP. On the other hand, RCA is being advised by Goldman Sachs & Co. LLC and Rothschild & Co. for financial matters, with legal counsel from Goodwin Procter LLP and ReedSmith LLP.

Optimism for the Partnership

RCA's CEO, Robby Grabow, expressed optimism about the partnership, emphasizing that the additional resources brought by Cencora will enhance the quality of care provided and facilitate the expansion of their physician network.

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