Select Medical stock price soars 8% on acquisition agreement

LootboxPhobia · 2026-03-04T02:04:18+00:00

Select Medical Holdings stock price rises 8% after announcing a merger agreement with a consortium to acquire shares not currently held at $16.50 per share in cash, valuing the company at $3.9 billion with a significant premium. The merger has been approved by the board of directors and is expected to be completed in 2026. The company will become private after the transaction. Analysts believe the acquisition valuation is fair.

LootboxPhobia

2026-03-04 02:04:18

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Investing.com – Select Medical Holdings (NYSE: SEM) stock rose 8% on Tuesday after the company announced it had reached a definitive acquisition agreement with a consortium led by Executive Chairman Robert A. Ortenzio, Senior Executive Vice President Martin F. Jackson, and Welsh, Carson, Anderson & Stowe.

The consortium will acquire all publicly traded common shares of Select Medical not already owned by the group at a cash price of $16.50 per share, valuing the company at $3.9 billion. This offer represents an 18% premium over the company’s stock price on November 24, 2025 (the last trading day before the public disclosure of the acquisition proposal) and a 25% premium over the 90-day volume-weighted average closing price as of that date. The stock closed at $15 on Monday.

The merger agreement has been unanimously approved by independent, disinterested members of the board, based on the recommendation of a special committee composed of independent directors. Mr. Ortenzio, Mr. Jackson, and certain affiliates have agreed to transfer their shares to the parent entity of the surviving company instead of receiving cash. The consortium may invite other management and board members to participate in the share transfer.

The transaction is expected to close in mid-2026, subject to customary closing conditions, including approval by a majority of shareholders not owned by the consortium or its affiliates, the expiration of the Hart-Scott-Rodino waiting period, and certain regulatory approvals. The deal is not subject to financing conditions.

Initial participants in the share transfer collectively hold approximately 11.8% of the outstanding shares and have agreed to vote in favor of the merger agreement. Upon completion, Select Medical will become a private company, and its stock will be delisted from the New York Stock Exchange.

Mizuho analyst Ann Hynes reaffirmed an Outperform rating and a $17.00 target price, commenting, “While the acquisition still requires regulatory and shareholder approval, considering the volatility in the critical care and outpatient segments and the company’s poor performance in 2025, we believe the $16.50 per share valuation is fair.”

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