UnitedHealth Group Inc. (NYSE:UNH) is rapidly expanding its healthcare services with the proposed purchase of DaVita Inc.'s (NYSE:DVA) physician group for about US$4.9bn in cash.
The biggest US insurer’s Optum health-services arm has been building up its physician practices, clinics and surgery centers over the years but the DaVita's group represents its highest-profile deal so far in this segment.
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Optum’s Larry C. Renfro said the acquisition "advances our shared goal of supporting physicians in delivering exceptional patient care in innovative and efficient ways."
DaVita Medical Group includes around 280 clinics offering primary and specialist care, as well as 35 urgent-care centers and six outpatient surgery centers, across California, Washington and Florida.
UnitedHealth said Optum aims to provide primary care and ambulatory services in 75 markets, representing about two-thirds of the U.S. population.
Last month, the company told investors that it has medical groups in 30 markets, and a health-care provider presence in 60.
DaVita bought the big medical group HealthCare Partners LLC in 2012 in a US$4.42bn deal that saw it move away from its core kidney-care business.
DaVita said it would use the proceeds from the deal with Optum for stock buybacks, debt repayment and other purposes. The companies said the deal was expected to close in 2018.
DaVita shares surged over 13% to US$69.20 on the day. UnitedHealth lost 0.07%.