Cencora to acquire American Oncology Network for $2.4 billion enterprise value
The deal includes up to $100 million in contingent value rights, and Cencora updated its fiscal 2026 adjusted EPS outlook to at least $17.90.
Key takeaways
- Cencora, Inc. (COR) said Oct. 21 it signed a definitive agreement to acquire American Oncology Network, Inc. (AONC) at an enterprise value of $2.4 billion, including $2.3 billion at closing. Cencora now expects fiscal 2026 adjusted diluted EPS of at least $17.90.
Cencora, Inc. (COR) said Wednesday it has signed a definitive agreement to acquire American Oncology Network, Inc. (AON), a physician-led network of more than 350 oncology providers across 21 states.
The enterprise value is $2.4 billion, according to a joint press release attached to a regulatory filing. It consists of $2.3 billion at closing and contingent value rights, or CVRs, of up to $100 million.
The CVRs are payable by Cencora upon the satisfaction of certain conditions. The filing does not list those conditions.
Cencora already holds about 4% of AON's equity interests. Under the agreement, it will acquire all of the equity interests it does not own. A wholly owned Cencora subsidiary, Dolphins Merger Sub, Inc., will merge into AON, which will survive as a wholly owned subsidiary of Cencora.
Deal terms and cash outlay
As it relates to Cencora's cash outlay at closing, certain AON stockholders may take part in an equity rollover representing up to 25% of AON.
Assuming those stockholders keep 25% of AON, Cencora expects to pay about $1.7 billion to increase its ownership in AON to 75%.
The company expects the acquisition to be accretive to its adjusted diluted earnings per share in the second year after closing. Accretive means the deal adds to per-share profit on that measure.
AON's board approved the agreement, acting on the unanimous recommendation of a special committee of independent and disinterested directors.
The transaction remains subject to customary closing conditions, including required regulatory clearances and approval by AON stockholders. The filing does not give an expected closing date.
Rationale for the deal
“The acquisition of AON will expand our physician-led oncology MSO and support of care in communities across the country,” said President and Chief Executive Officer Robert P. Mauch.
Mauch said the company will “enhance our capabilities for independent practices,” strengthening patient access to high-quality, cost-effective care.
AON Chief Executive Officer Todd Schonherz described the deal as “the next chapter of the same mission: high-quality, accessible cancer care delivered close to home, led by physicians who know their patients best.”
Clinical decisions will continue to rest with AON's physicians, the company said in the release.
Fiscal 2026 adjusted EPS outlook
Separately, Cencora updated its fiscal 2026 adjusted diluted earnings per share outlook. It now expects adjusted diluted EPS of at least $17.90, at the high end of its previous range of $17.75 to $17.95.
The update reflects the strength of the company's U.S. Healthcare Solutions reportable segment.
Cencora does not provide GAAP guidance for fiscal 2026 because certain financial information cannot be reasonably estimated. Its full-year closing procedures are not complete, so results may change.
The company will discuss its fiscal 2027 outlook on its fiscal fourth quarter 2026 earnings call on Nov. 4.
Advisers
Citi is lead financial advisor to Cencora, and J.P. Morgan Securities LLC is also a financial advisor. Holland & Knight LLP and Sidley Austin LLP are its legal advisors.
On AON's side, Moelis & Company LLC is exclusive financial advisor to the special committee. McDermott Will & Schulte LLP is legal counsel to AON, and Cleary Gottlieb Steen & Hamilton LLP is legal counsel to the special committee.