Amsurg Buys PE-Backed Sheridan Healthcare for $2.35B in Latest Physician Services Deal

Amsurg Corp., the operator of 242 U.S. ambulatory surgery centers, agreed to buy Sheridan Healthcare for $2.35 billion to add the country’s biggest provider of anesthesia services.

The cash and stock deal, agreed upon by both boards, will immediately contribute to Amsurg’s adjusted earnings per share, the Nashville, Tennessee-based company said today in a statement. Sheridan, based in Sunrise, Florida, is owned by private-equity firm Hellman & Friedman LLC.

“With the addition of Sheridan, we will be significantly diversified and differentiated -- holding leadership positions in outsourced physician services for anesthesia, children’s services, emergency medicine services and radiology,” Christopher Holden, chief executive officer of Amsurg, said in the statement.

Hellman & Friedman will be an “ongoing significant shareholder of the combined company,” Managing Director Allen R. Thorpe said in the statement. The deal is expected to close in the third quarter.

Sheridan provides physician services to hospitals and other health facilities on an outsourcing basis. It operates in 25 states and employs more than 2,400 physicians and other health- care professionals, according to the statement.

The purchase will drive Amsurg’s “entry into the large, fast-growing and fragmented physician outsourcing market,” the company said. Amsurg shares have gained 19 percent in 12 months. The stock closed at $42.80 yesterday in New York, giving the company a market value of $1.39 billion.

Sheridan investors will be issued Amsurg shares with a current value of about $615 million, the companies said. Amsurg may replace a “substantial portion” of the equity consideration with cash.

Citigroup Inc. is serving as financial adviser to Amsurg and Bass, Berry & Sims PLC is providing legal counsel. Barclays, Credit Suisse and Goldman Sachs are advising Sheridan, and Simpson Thacher & Bartlett LLP is providing legal counsel.

Several other physician groups have been acquired recently, including Summit Anesthesia Associates PA, which was acquired by Mednax (NYSE: MD), and SCP Physical Therapy and Dwight Orthopedic Rehabilitation, which were bought by KRG-backed ATI Physical Therapy. 

. In January, JLR Medical, Greater Houston Anesthesiology and Pinnacle Anesthesia announced a plan to combine forces to create U.S. Anesthesia Partners.

Additional reporting by Allison Collins.