Bravo Health to be acquired by HealthSpring in $545 million deal

August 27, 2010

(Reuters) Managed care company HealthSpring Inc said it agreed to acquire privately held, Baltimore-based Bravo Health Inc, an operator of Medicare plans, for $545 million to expand into the Philadelphia market.

The deal, which is expected to close before the year-end, will add 45-55 cents to HealthSpring's 2011 earnings per share, the company said in a statement.

Expenses related to the deal will impact 2010 earnings by about 20 cents, it added.

The transaction will be financed through cash and debt under an amended revolving credit facility and new term loans, the company said.

The company has entered into a $750 million financing commitment with JPMorgan Chase Bank and other banks, which consists of an amendment to HealthSpring's existing $350 million credit facility combined with $400 million of new loans.

Bravo Health, which operates Medicare Advantage coordinated care plans in Pennsylvania, the Mid-Atlantic region and in Texas, generated premium revenue of about $832.8 million in the first half of 2010, HealthSpring said.

Shares of Nashville, Tennessee-based HealthSpring, which have risen over 25 percent since early July, closed at $18.39 Thursday on the New York Stock Exchange.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.