VillageMD plans new debt financing for Summit Health purchase

By Sara Rosenberg

New York, Nov. 7 – VillageMD plans on using debt facilities and equity investments to fund its acquisition of Summit Health-CityMD, according to an 8-K filed with the Securities and Exchange Commission on Monday.

The company expects to maintain an investment-grade rating.

The acquisition is valued at about $8.9 billion – $7 billion equity value with $1.9 billion of net debt – with investments from Walgreens Boots Alliance Inc. and Evernorth, a subsidiary of Cigna Corp.

Walgreens will invest $3.5 billion through an even mix of debt and equity to support the acquisition, and will remain the largest and consolidating shareholder of VillageMD with about 53% ownership.

Closing is expected in the first quarter of 2023, subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other customary conditions.

VillageMD is a Chicago-based provider of primary care options. Summit is a provider of primary, specialty and urgent care.

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