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Investment firm urges Cano Health board to find buyer

An asset management company has urged Miami-based Cano Health's board of directors to find a strategic buyer.

Cano Health was notified by a letter from Owl Creek Asset Management, which strongly encouraged the board of directors to pursue strategic alternatives by engaging with investment bankers and other advisors to pursue a sale to a strategic buyer. 

The Aug. 22 letter cites "the past year's roller coaster of accounting issues" as having shaken investors' confidence. Furthermore, it says Cano Health has exceeded the guidance outlined in a 2021 investor presentation regarding membership, revenue, and adjusted earnings before interest, taxes, depreciation and amortization. 

"We feel that Cano's continued growth will require a larger and stronger vertically integrated partner with access to the capital needed to execute the Company's business plan," the letter states. 

According to the letter, Cano Health has consistently traded at a discount to its peers and needs capital to compete with peers and achieve available growth in current and new markets. 

"Given the persistent and wide gap between where Cano shares trade and the valuation of comparable companies, we believe there is ample room to come to terms with a strategic buyer that maximizes shareholder value and provides the Company a platform for future growth."

Owl Creek Asset Management owns 3.74 percent of the Class A equity shares of Cano Health, which was founded in 2009 and operates 130 owned medical centers and about 1,000 affiliate providers serving 227,000 members. 

Cano Health did not respond to Becker's requests for comment. 

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