PHILADELPHIA (Reuters) – Mental health facilities operator Psychiatric Solutions Inc (PSYS.O) said it hired Goldman Sachs as its financial adviser after being approached by third parties about a possible acquisition of the company.
The Wall Street Journal previously reported that private equity firm Bain Capital was in talks to buy the company, with Psychiatric Solutions seeking a 25 percent premium.
Any deal would include the assumption of $1.2 billion of Psychiatric Solutions’s debt, the newspaper reported.
Bain could not be immediately reached for comment.
Other private equity firms also previously eyed Psychiatric Solutions, the newspaper said.
CCMP Capital Advisors and Kohlberg Kravis Roberts & Co. looked at the business but eventually passed, while Blackstone Group considered merging the company into its hospital chain Vanguard Health Systems Inc, according to the Journal.
Psychiatric Solutions, which has a market capitalization of about $1.3 billion, said it formed a special committee of the board of directors to weigh a deal. It cautioned that there was no assurance that any purchase of the company would occur.
Shares of Psychiatric Solutions, which operates mental health care facilities in 32 states, closed at $29, up $5.09, or 21.3 percent, on the Nasdaq. The stock has more than doubled over the past 12 months, but is down from a high of $30.13 in September. (Reporting by Jessica Hall; Editing by Gary Hill and Steve Orlofsky