In an amended registration filing with the Securities and Exchange Commission, Agilon said it will offer 46.6 million shares of common stock at a price between $20 and $23 per share.
The IPO underwriters also have a 30-day option to purchase up to 7 million additional shares.
Agilon, which was founded in 2016 and incorporated in 2017, has a platform that sets up regional risk-bearing networks that allow primary care physician groups to treat Medicare Advantage patients using an HMO-style capitated cost model.
The company is controlled by an investment fund associated with Clayton Dubilier & Rice, a New York-based private equity firm.
According to the prospectus filed with the SEC, the CD&R fund owns 69% of all shares. After the offering, the firm is expected to own about 58% of shares, with the exact percentage depending on how many additional shares the underwriters purchase.
The filing states that Agilon has 16 physician group clients in Hawaii, North Carolina, Ohio, Pennsylvania and Texas serving about 131,000 Medicare Advantage patients. Another 49,000 Medicare Advantage patients are due to join by January 2022 under deals already reached with physician groups.
According to the initial securities registration filing on March 18, Agilon racked up losses of $282.7 million in 2019 and $60.1 million in 2020. The company attributed much of the 2019 loss to its California business, which it sold off in 2020.
The amended registration form filed April 7 gives a little more detail on the sale of those California operations, which took place in three separate transactions.
In August, the company sold its Southern California operations for $2.5 million; in October, it sold its Fresno operations for $26 million; and in December, the company agreed to sell the remaining operations for $1 million. Cumulatively, the transactions totaled nearly $30 million.
All of Agilon’s California operations treated Medicaid patients.
According to the prospectus filing, the central idea behind Agilon Health is the introduction of capitated costs for physician groups that treat large numbers of Medicare Advantage patients.
Medicare Advantage is the term used by the Centers for Medicare & Medicaid Services to describe all-inclusive Medicare coverage for seniors provided by the private sector.
This includes the core government-funded Medicare program plus benefits such as vision, dental, physical fitness programs and over-the-counter drugs.
