Are Envision Shareholders Getting Enough in the Acquisition?

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Envision Healthcare Corp. (NYSE: EVHC) saw its shares make a slight bump early on Monday morning after it was announced that the firm would be acquired by KKR & Co. L.P. (NYSE: KKR). This deal was unanimously approved by Envision’s Board of Directors.

Under the terms of the agreement, KKR will acquire all of the outstanding shares of Envision’s common stock for $46.00 per share in an all-cash transaction valued at $9.9 billion.

This price represents a 32% premium to Envision’s volume-weighted average share price (VWAP) from November 1, 2017, the day immediately following the company’s first announcement that it was reviewing strategic alternatives.

Separately, the price offers premiums of 15% and 18.8% over the stock’s 50- and 200-day moving averages of $39.99 and $38.73, respectively.

James D. Shelton, Envision’s Lead Independent Director, commented:

After conducting a robust review of the business and competitive landscape, the Company’s opportunities and challenges, and the strategic and financial alternatives available to the Company, the Board unanimously believes that this transaction will deliver the most value to Envision’s shareholders.

Shares of KKR were last seen at $22.98, with a consensus analyst price target of $27.00 and a 52-week range of $17.96 to $24.50.

Shares of Envision closed Friday at $43.64, with a consensus analyst price target of $45.63 and a 52-week range of $23.77 to $64.00. Following the announcement, the stock was up about 2% at $44.65 in early trading indications Monday.