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Occupational care provider Concentra files for IPO

Mar 18, 2024
Illustration of a person wearing scrubs using a blood pressure cuff made of money.

Illustration: Gabriella Turrisi/Axios

Select Medical Holdings subsidiary Concentra confidentially filed for a U.S. IPO Monday.

Why it matters: The potential offering would be the third health care debut this year as the U.S. IPO market crawls its way toward a comeback.

Yes, but: The recent flop of comparable health operator BrightSpring suggests obstacles for Concentra.

Zoom in: Select Medical (NYSE: SEM) has yet to specify a price range for the proposed offering.

  • SEM executives noted on an earnings call in February that Concentra had surpassed last year's revenue and patient volumes.
  • Overall, SEM reported growth in Q4 of 2023 with a 21% increase in adjusted EBITDA and a 5% rise in revenue.

The big picture: Skilled nursing provider PACS Group last week filed paperwork to go public, just months after KKR-backed home health company BrightSpring Health Services went public.

Reality check: BrightSpring's shares plummeted 15% after its debut — the worst outcome for a $250 million-plus listing since 2021.

Catch up quick: SEM announced plans to spin off Concentra in February.

  • The move is aimed at "enhancing shareholder value and the success of each business by creating two companies that will be leaders in their respective markets," SEM CEO Robert Ortenzio said on an earnings call that month.
  • Last fall, Concentra acquired three occupational medicine centers in Delaware and Maryland and opened three de novos in Norfolk, Virginia; Columbus, Ohio; and Fort Myers, Florida.

Context: Founded in 1979, Concentra provides occupational and physical therapy, urgent care services and drug screenings via 544 occupational health centers and 150 employer worksites across 42 states.

  • The company also offers telehealth for work-related illnesses and injuries.
  • Former Concentra owner Humana (NYSE: HUM) sold the company in 2015 for roughly $1.06 billion to a joint venture between Select Medical and PE firm Welsh, Carson, Anderson & Stowe.
  • Select Medical took full ownership of Concentra in 2021.
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