Cano Health Explores Selling After Receiving Acquisition Interest

Cano Health Explores Selling After Receiving Acquisition Interest

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By Anirban Sen, Greg Rumiliotis and David Karnevali

(Reuters) – Cano Health, the primary care provider in the United States, is exploring the possibility of selling and working with advisors after receiving takeover interest, according to people familiar with the matter.

Cano Health has received acquisition interest from potential buyers including Humana you (NYSE:) and CVS Health Corp (NYSE:), the sources said.

One source said Cano, which went public last year through a merger with a special-purpose takeover firm backed by billionaire Barry Sternlicht, received the takeover interest after its poor results last month, prompting it to explore a sale.

The sources said an agreement may be finalized in the coming weeks.

Kano declined to comment, while Humana and CVS said they do not comment on rumors or speculation.

Both CVS and Humana are among the companies talking to Cano about a deal, the sources said, and Humana has a right of first refusal in the event of a sale as part of an agreement between the two companies struck in 2019. Cano shares closed 32% after trimming some earlier gains, making Giving it a market capitalization of about $4.1 billion.

The Wall Street Journal first reported Kano’s talks with potential buyers earlier on Thursday. Bloomberg first reported on Kano’s conversations with CVS.

The sources, who requested anonymity because these discussions are confidential, warned that talks with buyers could break down and Kanu could choose to remain independent.

Healthcare companies have expanded beyond health and pharmaceutical benefits management through acquisitions of physician groups and surgical centers in recent years.

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Kanoo operates primary care centers in several US states including California, Florida, Nevada, New Mexico, Texas, Illinois and New York.

Hedge fund Third Point LLC, which owns 6.4% of Cano, has been pushing the Miami-based company to put itself up for sale as its share price has fallen since it went public.

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