Exploring the sale of Kano Health after receiving purchase interest

Sept 22 (Reuters) – U.S. primary care provider Kano Health is working with advisers after exploring a sale and receiving a takeover bid, people familiar with the matter said.

Kano Health has acquired purchasing interests including Himana Inc. and CVS Health Corp (CVS.N)said the sources.

Kano, which announced last year a merger with a special purpose buyout firm backed by billionaire Barry Sternlicht, received buyout interest last month after poor results, prompting them to explore a sale, one of the sources said.

A deal could be finalized in the coming weeks, the sources said.

Kano declined to comment, while Humana and CVS said they do not comment on rumors or speculation.

Both CVS and Himana are among the companies in talks with Kano about a deal, the sources said, and Himana has the right of first refusal on the sale under a 2019 deal between the two companies. Kano shares closed. 32% after comparing some earlier gains, giving it a capitalization of about $4.1 billion.

The Wall Street Journal first reported earlier on Thursday that Cannon’s talks would be potential buyers. Bloomberg first reported Canon’s talks with CVS.

The sources, who spoke on the condition of anonymity because these discussions are confidential, warned that talks with potential buyers could break down and that Kano would prefer to remain independent.

Healthcare companies have expanded beyond managing health and pharmacy benefits in recent years with the acquisition of physician groups and surgery centers.

Cano operates primary care centers in several US states, including California, Florida, Nevada, New Mexico, Texas, Illinois and New York.

Hedge fund Third Point LLC, which owns 6.4% of Cano, bought the Miami-based company to He offered himself for sale Since the stock price has been declining ever since it went public.

Additional reporting by Mrinalika Roy in Bengaluru; Editing by Shailesh Kuber and Josie Kao

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