McKesson Takes A Stake In Option Care — With An Option On The Rest

Private equity firm CD&R and McKesson Corporation (NYSE:MCK) on Tuesday agreed to acquire Option Care Health Inc. (NASDAQ:OPCH) for $32.05 per share. The transaction values Option Care at $5.8 billion and a 37% premium to the closing share price on Oct. 5. Financial Times was the first to report the deal. Wall Street analysts at William Blair commented on the deal’s strategic implications and valuation metrics for both companies. Read Also: McKesson Buys Precision Medicine to Expand Clinical Research and Commercialization Deal Structure And Ownership Split Upon closing in 2027, CD&R will hold a 51% majority interest. McKesson will receive a 49% minority stake for roughly $1.4 billion. Option Care Health will remain a separate operating company led by its existing management team. The structure establishes a framework for McKesson’s potential future acquisition of CD&R’s equity interest. McKesson stated the purchase aligns with strategic objectives to support complex specialty, rare, and orphan therapies across ambulatory and home settings. Analyst Takeaways On Option Care Valuation William Blair analyst Matt Larew viewed the valuation as low for Option Care Health but attractive for the buyers. Larew noted that Option Care Health’s year-to-date stock drop exceeding 27% stemmed from internal execution hurdles and a prolonged Stelara overhang that impacted management credibility. Comparing the transaction to scaled home-care peers like Enhabit, Amedisys, and LHC Group—which traded between 12 and 21 times EBITDA—Larew noted the implied valuation equals roughly 10 times Option Care Health’s consensus 2027 adjusted EBITDA. He described the premium as a slight disappointment for shareholders and suggested competing bids might emerge. McKesson Growth Outlook And Rating Concurrently, analyst Ryan Daniels reiterated an Outperform rating on McKesson, citing its long-term investment merits. Daniels emphasized McKesson’s leading scale within a high-entry-barrier distribution oligopoly, bolstered by a robust competitive moat and a shift toward high-margin technology services. Daniels noted that McKesson’s ongoing evolution into an embedded healthcare technology partner justifies its valuation. OPCH Price Action: Option Care Health shares were up 33.93% at $31.29 during premarket trading on Tuesday, according to Benzinga Pro data. Photo: Shutterstock Read Also: AI Is Creating a New Workplace Divide: College Graduates, Managers See More Benefits Than Other Workers