DaVita's largest business is kidney care, through the 2,470 outpatient dialysis centers that it runs or provides administrative services to across the USA, serving more than 200,000 patients a year.
UnitedHealth's Optum health-services arm has been building up its roster of physician practices, clinics and surgery centers with years of mostly under-the-radar acquisitions, but DaVita's group represents its highest-profile deal so far in the doctor business.
The payer believes that the merger of OptumCare and DaVita will create integrated ambulatory care delivery systems that improve costs and patient outcomes. The local offices include doctors offices and dialysis centers.
The transaction should close in 2018. UNH is up up 1%, but only on 2 shares.
The all-cash deal is UnitedHealth's second major acquisition in 2017 that aims to broaden its reach beyond insurance and boost its outpatient care services through a large network of clinics. The company already operates medical practices in Southern California and elsewhere, and it owns almost 250 MedExpress urgent-care clinics.
DaVita, a Fortune 500 company headquartered in Denver, will give Minnetonka-based UnitedHealth Group more access to dialysis patients across the country and medical-group patients in six states.
"We also look forward to working closely with the leadership team of DaVita Medical Group to combine our capabilities and, supported by the data analytics and technology capabilities of Optum, enhancing patient care and the value we provide to the communities we serve".
DaVita intends to use the proceeds from the sale for stock repurchases, debt repayment and general corporate purposes.
DaVita's unit had $4.1 billion of revenue previous year and an operating loss of $104 million.