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8-K - FORM 8-K - PSYCHIATRIC SOLUTIONS INC | g23476e8vk.htm |
EX-2 - EX-2 - PSYCHIATRIC SOLUTIONS INC | g23476exv2.htm |
Exhibit 99
Universal Health Services to Acquire Psychiatric Solutions for $3.1 Billion in Cash
Transformative Transaction Creates Premier Facilities-Based Healthcare Provider with Industry
Leading Behavioral Health Platform
KING OF PRUSSIA, Pa. & FRANKLIN, Tenn.(BUSINESS WIRE)Universal Health Services, Inc.
(NYSE: UHS News) (UHS) and Psychiatric Solutions, Inc. (NASDAQ:
PSYS News) (PSI) announced today that they have reached a definitive
agreement whereby UHS will acquire PSI for a price of $33.75 per share in cash, or approximately
$2.0 billion. Including the assumption of approximately $1.1 billion in PSI net debt, the total
transaction consideration is approximately $3.1 billion.
UHSs acquisition of PSI is a highly strategic transaction that brings together two complementary
companies to create a premier facilities-based healthcare provider with an industry-leading
presence in the behavioral health care services sector. PSI is the largest standalone operator of
owned or leased freestanding psychiatric inpatient facilities with 94 facilities in 32 states,
Puerto Rico, and the U.S. Virgin Islands. Today, UHS owns or operates 25 acute care hospitals and
102 behavioral health care facilities and schools located across 32 states, as well as in
Washington, D.C. and Puerto Rico.
The 2009 combined revenue and EBITDA (as defined below) of UHS and PSI was more than $7.0 billion
and approximately $1.1 billion, respectively. On a combined basis, in 2009 the company had
approximately 6.2 million patient days in 221 heath care facilities across 37 states and
territories. As a result of this combination, UHSs revenue from the behavioral health care
business will represent approximately 45% of combined 2009 revenue and approximately 54% of
combined 2009 EBITDA, before the allocation of UHSs corporate overhead costs.
This transformative transaction is very compelling for shareholders, patients and employees of
both companies, and we are excited to add PSIs assets to our portfolio, said Alan B. Miller,
Chief Executive Officer and Chairman of the Board of UHS. The combination with PSI will further
strengthen our behavioral health division, which has already grown substantially through capacity
expansion and strategic acquisitions. Importantly, the combined company will have ample
opportunities for further growth in both the acute care and behavioral health care sectors.
Mr. Miller continued, UHS is proud of its more than 30-year record of commitment to high quality
healthcare and achieving outstanding financial performance, and this transaction which we expect
to be significantly accretive to earnings will help us continue to deliver strong results and
increased shareholder value.
On behalf of the Special Committee of the board of directors of PSI, we are pleased to have
reached an agreement that will enable us to deliver significant and certain value to our
shareholders, said Christopher Grant, Jr., Chairman of the PSI Special Committee. After
conducting a thorough review of strategic alternatives and potential partners, we are pleased that
PSI will become an important part of an established and highly respected industry leader.
The combination is expected to generate approximately $35-45 million in annual cost synergies
within three years following close, with the majority occurring in years one and two. Excluding
one-time costs related to the acquisition, the transaction is expected to be significantly
accretive to UHSs earnings per share. In 2009, PSIs revenue was $1.8 billion with EBITDA of
approximately $330 million.
The transaction was unanimously approved by the Board of Directors of UHS. PSIs Board of
Directors, acting on the unanimous recommendation of the Special Committee, has approved the
agreement and recommend that PSI shareholders approve the merger.
The transaction has fully committed debt financing to be provided by JPMorgan Chase Bank N.A. and
Deutsche Bank AG. UHS expects to complete the transaction in the fourth quarter of 2010, subject to
customary closing conditions, including regulatory approvals and clearance under Hart-Scott-Rodino
Act, as well as approval by PSIs shareholders.
J.P. Morgan Securities Inc. is acting as financial advisor to UHS. Cravath, Swaine & Moore LLP is
acting as legal advisor to UHS.
Goldman, Sachs & Co. is acting as financial advisor to the Special Committee of the Board of
Directors of PSI. Shearman & Sterling LLP is acting as the Special Committees legal advisor.
Conference Call and Webcast Information:
UHS will hold a conference call for investors and analysts at 10:00 a.m. eastern time on May 17,
2010. The dial-in number is 1-877-648-7971. A digital recording of the conference call will be
available two hours after the completion of the conference call on May 17, 2010 and will continue
through midnight on May 31, 2010. The recording can be accessed by calling 1-800-642-1687 and
entering the conference ID number 76218999. This call will also be available live over the internet
at our web site at
http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.uhsinc.com%2F&esheet=6292993&lan
=en_US&anchor=www.uhsinc.com&index=1&md5=ccad9c8ad7f6ec4adda3e9d1b47d9b3b. There will be a
slide presentation that will accompany the conference call. The presentation will be available on
the home page and the investor relations page of our website.
About Universal Health Services, Inc.
UHS is one of the nations largest hospital companies operating, through its subsidiaries, acute
care hospitals, behavioral healthcare facilities and ambulatory centers located throughout the
United States and Puerto Rico. UHS acts as the advisor to Universal Health Realty Income Trust, a
real estate investment trust (NYSE: UHT News). For additional information on
the Company, visit our web site: http://www.uhsinc.com.
About Psychiatric Solutions, Inc.
PSI offers an extensive continuum of behavioral health programs to critically ill children,
adolescents and adults and is the largest operator of owned or leased freestanding psychiatric
inpatient facilities with more than 11,000 beds in 32 states, Puerto Rico and the U.S. Virgin
Islands. PSI also manages freestanding psychiatric inpatient facilities for government agencies and
psychiatric inpatient units within medical/surgical hospitals owned by others.
Forward-Looking Statements
This press release may contain forward-looking statements. Forward-looking statements may be
identified by words such as expects, anticipates, intends, plans, believes, seeks,
estimates, will or words of similar meaning and include, but are not limited to, statements
about the expected future businesses of UHS and PSI resulting from and following the proposed
acquisition. These statements are based on the current expectations of UHS and PSI and are
inherently subject to uncertainties and changes in circumstances. Among the factors that could
cause actual results to differ materially from those described in the forward-looking statements
are factors relating to the fulfillment of certain closing conditions to the proposed acquisition,
and changes in global, political, economic, business, competitive, market and regulatory forces.
UHS and PSI undertake no obligation to revise or update any forward-looking statements, or to make
any other forward-looking statements, whether as a result of new information, future events or
otherwise. Please refer to UHSs and PSIs filings with the SEC, including its most recent Annual
Report on Form 10-K, for more information on additional risks that could cause actual results to
differ from the forward-looking statements made herein.
This communication may be deemed to be solicitation material in respect of the proposed acquisition
of PSI by UHS. In connection with the proposed acquisition, UHS and PSI intend to file relevant
materials with the SEC, including PSIs proxy statement on Schedule 14A.
INVESTORS AND SECURITY HOLDERS OF UHS AND PSI ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH
THE SEC, INCLUDING PSIS PROXY STATEMENT, WHEN IT BECOMES AVAILABLE, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE PROPOSED ACQUISITION.
Investors and security holders will be able to obtain all such documents, when they become
available, free of charge through the website maintained by the SEC at
http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.sec.gov&esheet=6292993&lan=en_US
&anchor=www.sec.gov&index=3&md5=cb3b33d08a2f7326b9a0350f2a81283d, or by directing a request to
Investor Relations, Universal Health Services, Inc., Universal Corporate Center, 367 South Gulph
Road, P.O. Box 61558, King of Prussia, Pennsylvania 19406 (610-768-3300). Such documents are not
currently available.
UHS and certain of its directors and executive officers and other persons, and PSI and its
directors and certain executive officers, may be deemed to be participants in the solicitation of
proxies from the holders of PSI common stock in respect of the proposed acquisition.
Information regarding such persons and a description of their interests in the transaction will be
contained in the proxy statement when it is filed.
EBITDA is defined as earnings before interest, income taxes, depreciation, amortization,
stock-based compensation expense and income attributable to non-controlling interests.
Contact:
UHS
Investors:
Steve G. Filton, 610-768-3300
Chief Financial Officer
or
Media:
Sard Verbinnen & Co.
Drew Brown & Renée Soto, 212-687-8080
or
PSI
Investors:
Brent Turner, 615-312-5700
Executive Vice President, Finance and Administration
or
Media:
Joele Frank, Wilkinson Brimmer Katcher
Steve Frankel & Jamie Moser, 212-355-4449
Investors:
Steve G. Filton, 610-768-3300
Chief Financial Officer
or
Media:
Sard Verbinnen & Co.
Drew Brown & Renée Soto, 212-687-8080
or
PSI
Investors:
Brent Turner, 615-312-5700
Executive Vice President, Finance and Administration
or
Media:
Joele Frank, Wilkinson Brimmer Katcher
Steve Frankel & Jamie Moser, 212-355-4449