Oak Street Health, the US-based primary care provider backed by health system owner Humana, closed its initial public offering at approximately $377m yesterday.
The company floated on Thursday last week pricing more than 15.6 million shares on the New York Stock Exchange at $21 each to raise $328m.
Oak Street’s shares closed at $44.00 on Monday, giving it a market capitalisation of about $10.6bn, before the underwriters bought more than 2.3 million more shares through the over-allotment option.
Founded in 2012, Oak Street runs more than 50 primary care centres across the US states or Texas, Illinois, Michigan, Pennsylvania, Ohio, Indiana, North Carolina, Tennessee and Rhode Island for patients using government health insurance scheme Medicare.
The extra share sales mean Humana’s stake will be cut from 5.7% to 5.2% in the IPO. Growth equity firm General Atlantic’s share was diluted from 34.1% to 31.6% while investment firm Newlight’s went from 22.5% to 20.8%.
Humana had provided $50m for Oak Street in September 2018 but it has not disclosed details of when the other two invested. the company had raised another $150m in equity funding between 2012 and May 2019 according to regulatory filings.
JP Morgan, Goldman Sachs, Morgan Stanley, William Blair and Piper Sandler were joint book running managers for the IPO while Baird and Truist Securities were co-managers.
