Apollo Global Management will buy LifePoint Health in a $5.6 billion deal that will expand its rural U.S. hospitals business, the latest in a series of bets by private equity firms on healthcare. The deal comes as Tennessee-based LifePoint and many of its peers face higher medical costs, fewer patient admissions and changes to reimbursement policies in Medicare and Medicaid that have pressured profits.

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To compensate, LifePoint has been beefing up its presence in rural regions including in Pennsylvania and Tennessee, and streamlining operations at healthcare facilities there.

The deal will bring together LifePoint and Apollo`s RCCH HealthCare Partners, LifePoint said in a statement, confirming a Reuters report on Friday that the parties were in advanced talks for a buyout.

Apollo`s deal - its biggest this year - is the latest in a recent surge of public investments by U.S. private equity, the highest since the 2007-08 global financial crisis.

With a record $1 trillion in cash at their disposal, top private equity names have turned to healthcare. Just last month, KKR and Veritas Capital each snapped up publicly-listed healthcare firms in multi-billion dollar deals.

Indeed, hospital operators are alluring to investors, Cantor Fitzgerald analyst Joseph France said. Because their operations are largely U.S.-based, hospital firms benefit more from lower tax rates than the average U.S. company, and are also more insulated from global trade uncertainties, France said.

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Apollo`s transaction value includes $2.9 billion of LifePoint`s net debt and minority interest. The combined company will be led by current LifePoint Chief Executive Officer William Carpenter III.

LifePoint shares — down some 27 percent in the past year — jumped nearly 34 percent to $64 in premarket trading, $1 shy of Apollo`s all-cash offer price.

Barclays, Citigroup, RBC Capital Markets and Credit Suisse will finance Apollo`s acquisition. PSP Investments Credit USA LLC and an affiliate of Qatar Investment Authority will also provide part of the debt financing.

LifePoint will accept competing bids until Aug. 22, it said.