Shares of the big health insurer Aetna (NYSE: AET) soared by a much as 12% Thursday on news that it was in talks to be sold to pharmacy behemoth CVS Health (NYSE: CVS)
The Wall Street Journal, citing sources, reported that CVS Health has proposed to pay more than $200 per share for Aetna.
Aetna, which as of Thursday had a market value of $53 billion, was trading at about $175 per share after news of the prospective deal broke.
In addition to a chain of retail pharmacies, CVS Health also operates the Caremark pharmacy benefit manager, which has more than 75 million plan members.
Aetna in February abandoned an effort to merge with another large health insurer, Humana, after that $34-billion deal was blocked on antitrust grounds by a federal judge.
Other news swirling this week had The Hartford (NYSE: HIG) entering into a definitive agreement to acquire Aetna’s U.S. group life and disability business for cash consideration of $1.45 billion. This acquisition deepens and enhances The Hartford’s Group Benefits distribution capabilities and accelerates the company’s technology strategy.
Aetna has several options for use of the proceeds of the transaction, including but not limited to internal investments to enhance the company’s customer experience, share repurchases and repayment of debt. The acquisition is expected to close in early November, subject to state regulatory approvals and other customary closing conditions.
In early trading on February, Aetna shares climbed $1.34, to $179.94, while Hartford ducked lower 28 cents to $55.28
Related Stories
