Select Medical Holdings Corporation, one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the United States, has entered into a definitive agreement to be acquired by a consortium led by Executive Chairman and Co-Founder Robert A. Ortenzio, Senior Executive Vice President of Strategic Finance and Operations Martin F. Jackson, and private equity firm Welsh, Carson, Anderson & Stowe.
Under the terms of the agreement, the consortium will acquire all outstanding shares of Select Medical not already owned by the group for $16.50 per share in cash, representing an enterprise value of approximately $3.9 billion. The per-share consideration reflects an 18% premium over the company’s unaffected share price as of November 24, 2025, the last trading day prior to a publicly disclosed proposal submitted by Ortenzio to the board, and a 25% premium over the 90-day volume-weighted average closing price through that date.
The merger agreement was unanimously approved by the disinterested members of the board upon the recommendation of a special committee comprised entirely of independent directors. The special committee determined that the transaction is fair to, and in the best interests of, stockholders unaffiliated with the consortium.
As part of the transaction, Ortenzio, Jackson, and certain affiliates have agreed to roll over their equity into the parent entity of the surviving corporation rather than receive the cash consideration. Additional members of management and the board, excluding special committee members, may also participate in the rollover. The initial rollover participants collectively beneficially own approximately 11.8% of Select Medical’s outstanding common stock and have agreed to vote in favor of the merger agreement.
The transaction is expected to close in mid-2026, subject to customary closing conditions, including approval by a majority of the votes cast by holders of shares not affiliated with the consortium or rollover participants, the expiration or termination of waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, and other required regulatory approvals. The merger is not subject to a financing condition.
Select Medical expects to continue operating as usual during the pendency of the transaction, with its current management team remaining in place following completion. Upon closing, the company will become privately held, its shares will be deregistered under Securities and Exchange Commission rules, and it will no longer be listed on the New York Stock Exchange.
As of December 31, 2025, Select Medical operated 104 critical illness recovery hospitals in 28 states, 38 rehabilitation hospitals in 15 states, and 1,917 outpatient rehabilitation clinics across 39 states and the District of Columbia.
J.P. Morgan and Wells Fargo are serving as joint lead arrangers and bookrunners for the consortium’s committed debt financing. Goldman Sachs is serving as exclusive financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP as legal counsel to the special committee. Dechert LLP is serving as legal counsel to Select Medical. Wells Fargo and J.P. Morgan are also serving as financial advisors to the consortium, with Cravath, Swaine & Moore LLP as legal counsel. Barclays is acting as financial advisor to WCAS, with Ropes & Gray LLP as legal counsel. Paul Hastings LLP is serving as legal counsel to the debt financing sources.
