McKesson, CD&R near $5 billion-plus deal to buy Option Care, FT reports

Estimated read time: 1-2 minutes

Oct 5 — Drug distributor McKesson and private equity firm Clayton Dubilier & Rice are nearing a deal to acquire infusion services provider Option Care Health in a transaction valued ‌at more than $5 billion including debt, the Financial Times reported on Monday, ⁠citing people familiar with the matter.

Option Care's shares rose ⁠21% in extended trading following the report.

The deal could ‌be announced as ‌soon as Tuesday, although talks could still fall apart, ⁠the report said.

The possible acquisition ⁠would mark McKesson's latest deal as it seeks to expand its healthcare services footprint. In August, the company agreed to buy Precision Medicine Group for about $2.25 billion as part of a years-long effort to strengthen ‌higher-growth businesses.

Leerink Partners analyst Michael Cherny said the "strategic rationale" for a deal made sense, as it would expand McKesson's reach beyond physician offices into home and alternate-site care settings.

Option Care provides infusion services that allow patients to receive intravenous medications at home or in other outpatient settings rather than in hospitals.

McKesson had been reshaping its portfolio by exiting non-core assets and ‌investing in areas ‌such ⁠as oncology and specialty care.

Revenue in its oncology & multispecialty segment rose 33% in the latest reported quarter, helped by growth in specialty distribution and contributions from acquisitions.

McKesson declined to ‌comment, while CD&R and Option Care did not immediately ‌respond to Reuters' requests ⁠for comment on the report.

(Reporting by Sahil Pandey in Bengaluru; Editing by Maju Samuel)