What's Happening?
Privia Health Group plans to acquire Evolent Health's accountable care organization (ACO) business, expanding its value-based care footprint. The acquisition includes Evolent Care Partners' participation in the Medicare Shared Savings Program (MSSP) and various commercial and Medicare Advantage programs, adding over 120,000 attributed lives to Privia's network. The deal, valued at $100 million in cash at closing with an additional $13 million contingent on MSSP performance, is expected to close by the end of the year. Privia anticipates the acquisition will enhance its adjusted EBITDA in 2026.
Why It's Important?
This acquisition is a strategic move for Privia Health, significantly expanding its presence in value-based care across the U.S. The deal increases Privia's attributed lives to approximately 1.5 million, enhancing its ability to deliver comprehensive services and technology solutions to ACO-participating providers. For Evolent Health, the divestiture allows a sharper focus on specialty condition management, reducing leverage and improving cash flow. Analysts view the transaction as beneficial for both companies, aligning with their core competencies and strengthening their market positions.
What's Next?
Privia Health will integrate Evolent's ACO business into its operations, expanding its footprint to 11 additional states. The company plans to leverage its population health and value-based care expertise to improve patient outcomes and reduce costs. Evolent Health will use the proceeds to repay debt, focusing on specialty care management. The transaction is expected to close by the end of the year, with positive financial impacts anticipated for both companies.
