Bon Secours affiliate plans to acquire Surgery Partners in $5.7B deal: Questions and answers

The strong pace of mergers and acquisitions in the healthcare industry is continuing, and a major new deal this week illustrates a strong appetite for surgical centers.

HealthSpan Partners, an affiliate of Bon Secours Mercy Health, is planning to acquire Surgery Partners in a $5.7 billion deal. The organizations announced the deal Monday.

Here is a rundown of key details.

Q: Why is this happening?

A: Surgery Partners is growing and many patients have shown they are looking for different ways to get care, Bon Secours officials say.

Surgery Partners operates more than 200 locations in 30 states and its portfolio includes surgical hospitals, ambulatory surgery centers, urgent care facilities and physician practices with multiple specialties.

John M. Starcher, Jr., president and chief executive officer of Bon Secours Mercy Health, says the transaction will offer the chance to serve more patients and give them more options for the way they want to get care.

“As healthcare continues to evolve, it is important to grow in ways that allow us to serve more people, in more communities and through a broader range of care settings,” Starcher said in a news release. “Our relationship with Surgery Partners represents an important step toward advancing that commitment.”

Eric Evans, CEO of Surgery Partners, said he appreciated that HealthSpan Partners “recognizes the significant value that our physician partners and our colleagues have created for the communities we serve.

“We believe this transaction represents the best path forward for Surgery Partners, delivering an attractive all-cash premium to our shareholders while creating lasting benefits for our patients, physicians and other stakeholders,” Evans said in a news release.

Q: What are the terms of the deal?

A: HealthSpan Partners plans to acquire Surgery Partners in an all-cash deal. HealthSpan Partners says it will finance the deal through a combination of cash on hand and borrowing.

Affiliates of Bain Capital Private Equity will remain a significant partner. They will gain equity interests in HealthPartner.

Q: What is the timetable?

A: The organizations say they hope to finalize the deal in the first quarter of 2027. Regulators must sign off on the transaction, and Surgery Partners’ shareholders must also approve of the deal.

Q: Bon Secours Mercy Health is a Catholic health system. Will Surgery Partners be a Catholic Entity?

A: Surgery Partners says it expects to remain a secular organization and “will not be characterized as a Catholic ministry entity.”

Q: Will Surgery Partners remain on the Nasdaq Stock Exchange?

A: No. When the deal is done, Surgery Partners will become a privately held company and will no longer be listed on Nasdaq.

Q: Is this another indication of the preference for outpatient care?

A: Bon Secours officials say they recognize more patients want surgical procedures to be done outside of the hospital, or at least without a lengthy stay. Dr. Wael Haidar, president of clinical operations for Bon Secours Mercy Health and president of HealthSpan Partners, cited patient preferences.

“Patients increasingly expect healthcare to be accessible, convenient and centered around their needs,” Haidar said in a statement. “Our purpose is to make healthcare easier to access, easier to navigate and better for the people we serve. As more care moves beyond the hospital setting, patients are looking for high-quality care that fits more seamlessly into their lives.”

Q: Are other health systems looking at similar deals?A: Absolutely. In June, Ascension completed a $3.9 billion acquisition of AMSURG and its 300 ambulatory surgery centers. Ascension has said it’s looking to deliver more care outside of hospitals.

Q: Should we expect more deals like this?

A: It’s certainly possible, if not likely. Hospitals and health systems have shown more interest in mergers and acquisitions this year. Through the first three quarters of the year, the number of hospital deals has already surpassed the total of all last year.

Kris Blohm, managing director and M&A practice co-leader at Kaufman Hall, told Chief Healthcare Executive earlier this month that health systems are likely looking to acquire more surgical centers and outpatient facilities.

“That's the shift in care delivery, both to meet access and, frankly, patient and consumer demand,” Blohm said. “We expect to continue, and that will be across all service lines: ambulatory, ASC, physician practice … post-acute, non-acute, and certainly diagnostics.”