The Carlyle Group, TPG and Humana are buying Kindred Healthcare and splitting the company apart.

I know I am supposed to be full of holiday cheer this time of year, but yesterday’s official announcement that Kindred Healthcare will be sold to Humana, TPG and The Carlyle Group, and dismembered for just $9 per share, well, that has just made me a little down. Why?

Because I was an early believer in Kindred’s goal to be the post-acute provider of choice, with its home health and hospice, skilled nursing, LTAC and rehab businesses, all in about 17 concentrated locations. There was no other company quite like it, anywhere, and they were way ahead of the curve. Perhaps too far ahead, and that was part of the problem. Not to mention their SNF business always struggled, and reimbursement for everything else was like a perpetual yo-yo.

Had business really become so bad that the company was sold at a 24% discount to its price on July 3, and a 42% discount to its high in 2016, and a 63% discount to the high of $24.66 in 2015? Now you can see why I am depressed.

Even with an enterprise cost of about $4.1 billion, inclusive of the debt, the buyers may be able to do well with the two parts. But I am still suspect of managed care companies such as Humana getting into the provider side of the business. And, this is yet one more company taking the go-private route, and Brookdale Senior Living may be the next one. I will keep you posted, but in the meantime, have a Merry Christmas and Happy New Year. I will try to cheer up.