Potential cash-and-stock transaction could top $66 billion
NEW YORK — A deal for CVS Health to acquire Aetna Inc. could happen by the end of the month, published reports say.
Citing anonymous sources, The Wall Street Journal reported Monday that CVS was nearing a $66 billion agreement to buy the health insurer, according to reports. The news of a potential CVS-Aetna merger deal lifted Aetna’s stock price as of afternoon trading.
Earlier this month, Reuters reported that CVS and Aetna might unveil an acquisition deal in December and were working on finalizing terms. The price for Aetna could be over $200 per share, with the total deal value in cash and stock exceeding $70 billion, according to Reuters.
Reports have said a CVS-Aetna combination would create a health benefits and services giant that could compete with UnitedHealth Group, the largest U.S. health insurer, whose units include OptumRx, a pharmacy benefit manager and health clinics.
Despite its retail origins, CVS Health has increasingly focused on health care since its 2006 acquisition of PBM Caremark Rx. CVS Health’s integrated pharmacy care businesses include the drug store chain CVS Pharmacy, CVS Caremark PBM, in-store medical clinic operator MinuteClinic and specialty pharmacy CVS Specialty.
Aetna earlier this year was rejected in an effort to add scale. In February, after being blocked by a federal court, Aetna and fellow health insurer Humana decided to kill their $37 billion merger deal.
Reports say a potential CVS-Aetna merger is being driven in part by concern that e-tail giant Amazon is mulling an entry into the pharmacy business.
The speculation about CVS and Aetna surfaced not long after reports that Amazon has gained wholesale pharmacy licenses in a dozen or more states, stirring up a pharmacy industry already unsettled by proliferating reports that Amazon could enter the sector. Jefferies analyst Brian Tanquilut said in a research note this month, however, that the Amazon licenses appear to be for medical devices and supplies only.