Centers Health Care, owned by Kenny Rozenberg and Daryl Hagler, has signed a deal to sell its subsidiary, Centers Plan for Healthy Living (CPHL), to Elevance Health, a health services and insurance giant. The deal is valued at hundreds of millions of dollars. Rozenberg, who controls 47% of El Al, Israel’s national airline, has seen the airline’s market value climb to 3.16 billion shekels ($850 million) this year.
Elevance Health, a publicly traded company with a market value of $115 billion, reported the transaction to the U.S. Securities and Exchange Commission (SEC) but did not disclose the exact purchase price. Industry insiders estimate it could reach up to $1 billion. The deal is awaiting regulatory approvals, including from the U.S. Federal Trade Commission, causing a slight delay in its finalization.
CPHL provides healthcare services to 57,000 clients in New York State through a Medicaid contract worth $16 billion, running from 2022 to 2026. Elevance Health’s subsidiary, which serves 53,000 clients under a $13 billion contract, is the second-largest provider in the sector. Following the acquisition, Elevance Health will control 38% of New York's Medicaid market.
Rozenberg, who built his fortune through nursing homes, purchased his first facility in the Bronx in 1995. Today, Centers Health Care operates 38 nursing homes and owns various businesses, including an ambulance service and real estate. Although the company is private, the transaction suggests its value is in the billions.
Elevance Health, which serves over 100 million Americans, rebranded in 2022 after operating as Anthem since its founding in 1944. It is traded on the New York Stock Exchange and has no controlling shareholder. Most of its shares are held by institutional investors such as Vanguard, BlackRock, and Fidelity. The company employs over 102,000 people.
Rozenberg took control of El Al in 2020 by purchasing stock during a public offering, rescuing the airline from collapse during the COVID-19 crisis. His total investment, including options, is estimated at 840 million shekels. Since October 2023, El Al’s market value has surged by more than 110%, making Rozenberg’s shares worth around 1.5 billion shekels.
El Al benefited from international airlines suspending flights to Israel following the start of the Gaza war, triggered by Hamas’s massacre of 1,600 Israeli civilians. With other airlines halting flights due to missile threats from Hezbollah and Iran, El Al’s market share on routes to North America surged to 90%, driving record profits. From the fourth quarter of 2023 to the second quarter of 2024, El Al reported a net profit of $266 million, after a decade of losses totaling $650 million.
However, a lawsuit filed by New York State in June 2023 has cast a shadow over Rozenberg and Hagler’s nursing home operations. The lawsuit accuses them of embezzling $83 million in state funds intended for nursing home residents' care. It also alleges that cost-cutting measures created poor working conditions that led to serious injuries and deaths. The suit claims Rozenberg acquired control of El Al with a $103 million loan from Hagler, which lacked documentation and repayment terms. Rozenberg’s spokesperson has denied the allegations.
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