Cross Country Healthcare merger faces regulatory scrutiny

Cross Country Healthcare Inc. (NASDAQ:CCRN), a provider of healthcare staffing services with a market capitalization of approximately $594 million, has received a request for additional information from the U.S. Federal Trade Commission (FTC) in connection with its ongoing review of the company’s planned merger with Aya Holdings II Inc., as disclosed in a recent SEC filing. According to InvestingPro analysis, the company maintains a "GREAT" financial health score of 3.3, suggesting strong operational fundamentals heading into this strategic transaction.

The request, known as the Second Request, was issued on Thursday and extends the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. This period will now last until 30 days after both Cross Country Healthcare and Aya have substantially complied with the FTC’s inquiry, which could be further extended or terminated by the FTC.

The merger, initially announced on December 3, 2024, involves Cross Country Healthcare merging with a subsidiary of Aya Holdings II Inc., with the intent for Cross Country to become a wholly-owned subsidiary of the parent company and an indirect subsidiary of Aya Healthcare, Inc. The deal aims to combine resources to enhance service offerings in the healthcare staffing industry. The company’s strong financial position is evidenced by its healthy current ratio of 2.79, indicating robust liquidity to support the transition. Get deeper insights into CCRN’s merger potential with a comprehensive InvestingPro Research Report, part of our analysis of 1,400+ US stocks.

The FTC’s Second Request indicates a more in-depth review of the merger’s potential impact on competition, suggesting a higher level of regulatory scrutiny. This development has led Cross Country Healthcare to adjust its expectations for the merger’s completion to the second half of 2025, pending stockholder approval and other customary closing conditions.

Investors and stakeholders are advised that the definitive proxy statement related to the merger has been filed and is available through the SEC website. This document contains important information regarding the proposed transaction, including the terms and conditions, and the reasons behind the Board’s approval.

Cross Country Healthcare is cooperating with the FTC and is working towards satisfying the conditions outlined in the Second Request. The merger’s finalization is subject to regulatory approvals and the fulfillment of other conditions as outlined in the Merger Agreement.

The information in this article is based on Cross Country Healthcare’s SEC filing and is intended for informational purposes only. It does not constitute an offer to buy or sell securities or a solicitation of any vote or approval.

In other recent news, Cross Country Healthcare has entered into a definitive agreement to be acquired by Aya Healthcare in an all-cash transaction valued at approximately $615 million. Cross Country stockholders will receive $18.61 per share, representing a 67% premium over the company’s recent closing price. The acquisition, expected to close in the first half of 2025, has been unanimously approved by Cross Country’s Board of Directors, with a recommendation for stockholders to vote in favor at an upcoming Special Meeting. Truist Securities has raised its price target for Cross Country Healthcare to $18.61, aligning with Aya Healthcare’s acquisition offer, while maintaining a Hold rating on the stock. The merger will combine Aya’s healthcare talent software and staffing services with Cross Country’s extensive clinical service experience, aiming to enhance service delivery and patient care outcomes. Both companies will continue to operate under their respective brands post-transaction, leveraging each other’s strengths for improved efficiency. Legal advisory for the deal is being provided by Procopio, Cory, Hargreaves (LON:HRGV) & Savitch LLP for Aya Healthcare, and BofA Securities, Inc. along with Davis Polk & Wardwell LLP for Cross Country Healthcare. Upon completion, Cross Country will become a privately held company, and its stock will be delisted from the NASDAQ.

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