Select Medical Holdings Corp. (SEM) received a non‑binding indication of interest from its Executive Chairman, Robert A. Ortenzio, to acquire all outstanding shares at a price of $16.00 to $16.20 per share. The proposal was disclosed in a Schedule 13D filing on November 24, 2025, and publicly announced the same day. The board has begun a review of the offer with independent advisors, with no commitment to accept the proposal at this time.
The proposed price represents a premium of up to 15.6% over the company’s prior trading level and sits above the 52‑week low of $11.69. It also exceeds the company’s forward price‑to‑earnings ratio of 10.43×, which is lower than the industry average of 15×, suggesting the market may be undervaluing the business.
In Q3 2025, SEM reported revenue of $1.36 billion, up 7% year‑over‑year, and earnings per share of $0.23, driven by a 7% increase in revenue from its critical‑illness recovery and rehabilitation hospital segments while outpatient clinic revenue remained flat. In Q4 2024, revenue was $1.31 billion, up 7.8% YoY, but adjusted EPS of $0.18 fell short of estimates due to higher operating costs in the rehabilitation segment. For full‑year 2024, the company projected revenue of $5.4 billion to $5.6 billion and adjusted EBITDA of $520 million to $540 million, reflecting steady demand for post‑acute care services.
Executive Chairman Ortenzio owns roughly 11.3% of SEM, with an additional 3.3% held by the estate of Rocco A. Ortenzio, giving him significant influence over the transaction. The take‑private proposal would remove the company from public markets, potentially allowing management to pursue long‑term initiatives without short‑term earnings pressure. The board’s review will assess whether the offer aligns with shareholder interests and the company’s strategic goals.
Following the announcement, market participants expressed caution, citing valuation concerns and the need for a thorough review. The board’s decision will determine whether the company accepts the offer, seeks alternative proposals, or continues as a public entity. The outcome will shape the company’s capital structure, strategic focus, and shareholder returns.
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