Astrana Health (ASTH) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition expands provider network into new and adjacent markets, including Orange County, San Diego, San Antonio, and Rhode Island, enhancing access and value for members.

• Adds 610,000 value-based care members, bringing the combined entity to 1.7 million across 13 states.

• Strengthens ability to deliver payer-agnostic, patient-centered care across Medicare Advantage, Medicaid, and commercial lines.

• Shared culture and mission to provide affordable, accessible care tailored to local communities, keeping healthcare local and personalized across four states.

• Partnership leverages complementary clinical workflows, technology, and care delivery assets.

Financial terms and conditions

• Purchase price is $745 million, funded by cash on hand and a $1.095 billion, 364-day bridge loan from Truist Bank and JPMorgan.

• Prospect expected to generate $1.2 billion in revenue and $81 million in adjusted EBITDA for 2024, reflecting a 9x EBITDA multiple.

• Pro forma net leverage at close expected to be 3.4x, with a target to reduce to under 2.5x within 24 months.

• Free cash flow for 2025 projected at $50–$60 million.

Synergies and expected cost savings

• $12 million in synergies targeted by 2027, driven by revenue opportunities and operational integration.

• Clear financial and operational synergies anticipated due to strong cultural alignment and cohesive missions.

• Synergies expected to materialize gradually post-closing, with more clarity as integration progresses.