2026-10-06

Option Care Health (OPCH) Stock Jumps 34% as McKesson and CD&R Agree to $5.8B Buyout at $32.05 a Share

Written & reviewed by the TradeSmrt editorial team · 2026-10-06

In this article

What Happened
Why McKesson Chose a Minority Stake Instead of a Full Takeover
Market Size and a Prior Failed Deal
What to Take Away From This
FAQ
Sources

What Happened

On Tuesday, October 6, Option Care Health (NASDAQ: OPCH), the largest independent provider of home and alternate-site infusion therapy in the United States, confirmed a definitive agreement to be acquired by private equity firm Clayton, Dubilier & Rice (CD&R) alongside McKesson Corporation (NYSE: MCK), the country's largest pharmaceutical distributor. The deal values Option Care Health at $32.05 per share, roughly a 37% premium to its October 5 closing price, and puts the total enterprise value of the transaction at approximately $5.8 billion. Shares jumped as much as 34% intraday on the news.

The move actually played out over two days rather than one. A day earlier, on October 5, reports first surfaced that McKesson was preparing an offer, and the stock jumped nearly 22% in after-hours trading on that report alone. In other words, the market priced in most of the move before the companies even confirmed anything - and then added another leg higher once the rumor became an official, signed agreement the next morning. That two-stage pattern, where a deal leaks before it's formally announced and the stock reacts in two separate jumps, is a fairly common feature of M&A situations and worth recognizing when you see a stock suddenly spike on an unconfirmed report.

The ownership structure is also worth a closer look, because it isn't a conventional single-buyer takeover. CD&R will hold a majority stake of roughly 51% and will control the company going forward, while McKesson is investing about $1.4 billion for a minority stake of approximately 49%. Once the deal closes, Option Care Health will be taken off the Nasdaq and become a private company, but it will keep operating as a standalone business under its existing management team rather than being absorbed into McKesson's operations.

Why McKesson Chose a Minority Stake Instead of a Full Takeover

The first question worth asking is why McKesson didn't simply buy Option Care Health outright instead of splitting ownership with a private equity firm. Two practical reasons stand out. First, cost: sharing the deal with CD&R cuts McKesson's own cash outlay to roughly $1.4 billion rather than funding the full $5.8 billion enterprise value alone. Second, and arguably more important, is antitrust exposure. McKesson is already one of the "Big Three" U.S. pharmaceutical distributors, alongside Cardinal Health and Cencora (formerly AmerisourceBergen), and together the three control the overwhelming majority of U.S. drug distribution. A full outright acquisition of a leading infusion-services provider by a company that size would likely draw heavier antitrust scrutiny than a minority investment where a separate private equity firm, CD&R, holds operating control.

So why is McKesson interested in this corner of healthcare at all? The answer lies in a broader shift in American healthcare known as "site of care" migration. Expensive specialty drugs - oncology treatments, infusible biologics for autoimmune disease, and similar therapies - have traditionally been administered in hospitals or specialty clinics. Over the past several years, insurers and government payers alike have pushed hard to shift that same care into patients' homes, since home infusion is materially cheaper than a hospital stay for an identical drug. Option Care Health, as the largest home infusion network in the country, sits at the center of that shift. McKesson is already the dominant player in getting drugs from manufacturers to pharmacies and hospitals; investing in Option Care Health extends that reach one step further, into the last mile where the drug actually gets into the patient. It's a textbook vertical-integration move - expanding from simply distributing medicine into managing more of the pathway between the drugmaker and the patient.

Market Size and a Prior Failed Deal

The U.S. home infusion therapy market was valued at roughly $22 billion in 2025 and is projected to grow at a 7-8% annual rate toward roughly $40 billion by 2033. It remains a notably fragmented industry, however, with close to 900 individual providers still operating across the country. Deals like this one, where large, well-capitalized players use their balance sheets to consolidate smaller operators, are becoming more common - which makes this transaction less a standalone event and more a signal of where the broader industry is heading.

One ironic wrinkle: Option Care Health itself was on the other side of a major deal just a few years ago. In 2023, the company agreed to acquire home health and hospice provider Amedisys for roughly $3.6 billion, only to lose that deal when UnitedHealth's Optum unit swooped in with a higher competing bid and ultimately walked away with Amedisys instead. The same company that lost a bidding war as an acquirer is now, a few years later, the target being taken private at a 37% premium - a reminder that in healthcare M&A, a company's position as predator or prey can flip within a handful of years.

Zooming out further, this deal also fits a pattern across the entire "Big Three" distribution industry. McKesson, Cardinal Health, and Cencora have all been expanding beyond pure drug distribution in recent years, buying into specialty pharmacies, oncology clinic networks, and provider-services businesses. Traditional distribution is a low-margin, high-volume business by nature, since distributors essentially move product between manufacturers and pharmacies for a thin cut. Services that touch the patient directly, like specialty infusion, tend to carry fatter margins. Seen in that light, this isn't just a McKesson decision - it's part of an industry-wide push to shift the center of gravity from low-margin middleman logistics toward higher-margin patient-facing care.

Timing matters too. A transaction of this size in the U.S. has to clear a Hart-Scott-Rodino antitrust review and waiting period, which typically takes several months. Regulators tend to scrutinize vertical deals involving a company that already dominates an adjacent market even more closely than ordinary mergers, which is likely part of why the deal is structured with CD&R in control and McKesson limited to a minority stake.

What to Take Away From This

M&A news often hits a stock in two separate waves - the leak, and then the confirmation. Option Care Health jumped 22% on an unconfirmed report and then kept climbing once the deal was formally announced. A big chunk of the total move can happen before anything is officially signed.
The size of a takeover premium tells you how strategically important the buyer thinks the asset is. A 37% premium signals McKesson sees real, lasting value in the "site of care" shift toward home-based specialty drug administration, not just an opportunistic bargain purchase.
When a dominant company takes a minority stake instead of buying outright, antitrust considerations are usually part of the calculus. The more market power an acquirer already has, the more likely it is to structure a deal this way to limit regulatory pushback.
Consolidation in a fragmented industry rarely stops at one deal. With roughly 900 providers still competing in U.S. home infusion, this transaction could be the first of several similar moves as larger, better-capitalized players buy up smaller operators.
A company's role in M&A can flip completely within a few years. Option Care Health lost a bidding war for Amedisys in 2023 and is now the one being acquired - a useful reminder not to assume today's acquirer will always be tomorrow's acquirer, too.

FAQ

What happens to Option Care Health shareholders now?

Once the deal closes, shareholders will receive $32.05 in cash per share and the stock will be delisted. The transaction still needs to clear a shareholder vote and antitrust review, so if the stock trades below $32.05 in the meantime, that gap - often called a merger arbitrage spread - reflects the market pricing in the time and regulatory risk still remaining before the deal is finalized.

How did McKesson's own stock react to the announcement?

Because McKesson's own market capitalization is far larger than the roughly $1.4 billion it's committing to this deal, its stock typically shows a much more muted reaction than the target company's. Investors are watching less for an immediate stock pop and more for what the investment signals about McKesson's longer-term strategy in specialty pharmacy and site-of-care services.

Is this deal guaranteed to close?

Not yet. It still needs approval from Option Care Health shareholders and clearance from U.S. antitrust regulators, including a Hart-Scott-Rodino review. McKesson's choice to take a minority stake rather than fully acquire the company is widely read as an attempt to ease that regulatory path, but deal terms can still change or face delays during the review process.

Sources

This article is an original synthesis and analysis based on the reporting below, not a reproduction of the original articles. Please check the source articles directly for the most current figures.

⚠️ This article is for informational purposes only and is not investment advice. Market conditions change constantly - always verify the latest data before making investment decisions.