LHC Group and UnitedHealth Group have extended their merger agreement as the feds take a deeper look at the deal.
The agreement was extended until March 28, 2023, and the two companies now expect the merger to close in the first quarter of 2023, according to a filing with the Securities and Exchange Commission.
That the insurance giant intended to acquire LHC, a home health provider, was announced in March, and the deal is valued at about $5.4 billion. UnitedHealth said it plans to fold LHC into its Optum subsidiary as part of its provider arm, Optum Health, which is one of the country's largest employers of physicians.
LHC Group would add 30,000 employees who provide more than 12 million home health services annually.
The Federal Trade Commission (FTC) issued a second request for information in June on the deal. In the filing, LHC Group said that both companies have certified "substantial compliance" with the FTC.
The ongoing FTC probe is the second major issue that the companies have encountered on the path to closing this merger. An LHC shareholder sued the company in May, arguing LHC withheld key details in its documents recommending shareholders approve the sale to UnitedHealth.
It's also the second major acquisition by UHG that's run into concern from federal regulators. The Department of Justice (DOJ) sued to block the company's purchase of Change Healthcare, though UnitedHealth prevailed in court as a federal judge allowed the merger to move forward.
DOJ is planning an appeal, though that challenge would now pit it against a closed deal and companies that have begun integration.