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New Mountain Capital forked over around $280 million to buy health tech AI business Apixio from Centene, sources familiar with the deal tell Aaron.

Why it matters: As health care strategics prune their portfolios, private equity is picking up the clippings. (More on that below.)

New Mountain did not return multiple requests for comment.

Details: Centene expects the transaction to be neutral to 2023-adjusted EPS.

William Blair and Bass, Berry & Sims offered sell-side financial and legal counsel, respectively.

JP Morgan Securities was the buy-side adviser for New Mountain, while Ropes & Gray served as its legal counsel.

Flashback: Centene bought Apixio back in December 2020 for an undisclosed price after the company raised significant venture dollars.

How it works: Apixio compiles and analyzes large volumes of unstructured patient information, including medical charts and physician's notes, into insights and curated data.

What they're saying: "Apixio, an AI platform that enables value-based care would be better served under the ownership of New Mountain Capital," said Centene CEO Sarah London in a press release.

1 big thing: New Mountain shells out $280M for Apixio

Illustration of code in a health cross symbol

Private equity firms Advent International and Warburg Pincus have agreed to buy Baxter International's contract manufacturing unit for $4.25 billion.

Why it's the BFD: Corporate divestitures have become increasingly important for private equity, as sponsor-to-sponsor sales have stagnated. Also on the rise are club deals, given difficulties in securing leveraged financing at attractive rates, Axios' Claire Rychlewski writes.

Details: Baxter will receive $4.25 billion in cash, with after-tax proceeds estimated at around $3.4 billion.

The transaction is expected to close in the second half of this year, pending regulatory approval.

For the fourth quarter, Baxter estimates the deal will dilute about 10 cents per share to the company’s earnings.

Catch up fast: Baxter's CMO division drew interest from strategics including Celltrion and Thermo Fisher Scientific, plus private equity firms KKR and Carlyle.

Proceeds will help Baxter pay down debt, which grew from its $10.5 billion acquisition of medical device maker Hillrom in 2021.

Look ahead: Baxter announced plans in January to spin off its renal care and acute therapies units over the next 12 to 18 months.

2. The BFD: Baxter selling CMO unit for $4.25 billion

Illustration of a handshake with shapes and money.

Jenny Craig, the weight loss and nutrition business acquired by H.I.G. Capital in April 2019, is shutting down after failing “to secure additional financing.” https://axios.link/44wkhCU

Court Square Capital announced a strategic investment in Team Select Home Care, a Phoenix-based pediatric home care company. https://axios.link/3B9EzV2

Thurston Group-backed ARC Health acquired Positive Change Counseling Center, a La Mesa, California-based mental health practice. https://www.pccounselingcenter.com/ 

Option Care Health, a Reno, Nevada-based post-acute care and infusion services provider, acquired Amedisys (Nasdaq: AMED), a home health and hospice provider, for $3.6b in an all-stock deal. https://axios.link/3VHmgjA 

Henry Schein (Nasdaq: HSIC) agreed to buy Brazilian dental implant maker SIN Implant Systems. www.henryschein.com

3. Deals o' the day

Zyter | TruCare named former Forrester VP and principal analyst Natalie Schibell VP of product marketing.

Lindus Health named former University of Oxford director of operations Emma Ogburn VP of clinical operations.

Cigna named former Google director of clinical products Charles DeShazer executive in residence.

NextCare named Verana Health president Miki Kapoor chair of the board of directors.

Janus Health named former Olive AI implementation success owner Neesh Shah customer success manager.

4. It's Personnel

🦄 7 digital health "unicorns" that have struggled — Modern Healthcare

➕ As health companies look toward AI, many people are still missing out on basic services — Fortune

👀 Liz Holmes wants you to forget about Elizabeth — The New York Times

5. Your daily dose

Illustration of a Axios brand medicine bottle that says "your daily dose" next to a spoon.

🌉 Situational awareness: Axios BFD is heading to San Francisco on Wednesday! You’ll hear from big names in Silicon Valley (and beyond) on the trends driving headlines, markets and deals. The livestream starts at 2pm PT — register here to join us virtually.

🐝 Erin came home sick from Milken but scared off the cold with back-to-back episodes of "Yellowjackets."

💖 Thanks for reading, and extra thanks to newsletter editor Claire Rychlewski and copy editor Jay Bennett. Please ask your colleagues, friends and family to sign up.

May 08, 2023

1 big thing: New Mountain shells out $280M for Apixio