Diplomat Pharmacy acquired by UnitedHealth Group: fairness opinion
Announced December 9, 2019 · Merger ·
SC 14D9 filed January 9, 2020
Enterprise value
$898M
EV / LTM EBITDA
12.1x
EBITDA $74.0M · 1% margin
EV / LTM revenue
0.18x
revenue $5.1B
DCF discount rate
10.5%
Deal terms
Consideration—
Price per share—
Premium—
Premium basis—
StructureMerger
Termination fee—
Reverse termination fee—
Go-shopNone
Outside date—
FilingSC 14D9 · EDGAR index
3,000+ healthcare deal-level valuation multiples
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Management projections
| Projection year | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | CAGR |
|---|---|---|---|---|---|---|
| Revenue | $4.4B | $4.7B | $4.9B | $5.2B | $5.5B | 5.4% |
| Revenue growth | -13.2% | 5.4% | 5.4% | 5.4% | 5.5% | |
| EBITDA | $85.0M | $95.0M | $104M | $113M | $123M | 9.7% |
| EBITDA growth | 14.9% | 11.8% | 9.5% | 8.7% | 8.8% | |
| EBITDA margin | 2% | 2% | 2% | 2% | 2% | |
| Implied EV / EBITDA | 10.6x | 9.5x | 8.6x | 7.9x | 7.3x |
Year-1 growth is against LTM at announcement ($5.1B revenue, $74.0M EBITDA); later years are year over year.
Other Pharmacy / Infusion fairness opinions
- PharMerica / KKR 2017 · 9.6x EV/EBITDA
- CVS Health / Aetna 2017 · 7.2x EV/EBITDA
- Omnicare / CVS Health 2015 · 15.8x EV/EBITDA
- Walgreens / Sycamore Partners 2025 · 52.4x EV/EBITDA