CVS Health has agreed to acquire health insurer giant Aetna for $69 billion in a landmark deal that that will redefine access to high-quality care in lower cost, local settings whether in the community, at home, or through digital tools.
This is the next step in our journey, positioning the combined company to dramatically further empower consumers. Together with CVS Health, we will better understand our members’ health goals, guide them through the health care system and help them achieve their best health,” said Mark T. Bertolini, Aetna chairman and CEO in a statement. “Aetna has a proud tradition of continually innovating to address unmet consumer needs and providing leading products and services to the marketplace.”
Bertolini continued, “Aetna has a talented and dedicated group of employees working to build a healthier world every day. Our combined company will be more competitive in the marketplace and accelerate progress toward achieving this mission.”
Here are eight things to know about the landmark deal:
1. Under the terms of the merger agreement, Aetna shareholders will receive $145.00 per share in cash and 0.8378 CVS Health shares for each Aetna share. The transaction values Aetna at approximately $207 per share or approximately $69 billion. Including the assumption of Aetna’s debt, the total value of the transaction is $77 billion.
2. Upon closing of the transaction, Aetna shareholders will own approximately 22% of the combined company and CVS Health shareholders will own approximately 78%.
3. The merger is expected to deliver personalized health care experience will be delivered by connecting Aetna’s extensive network of providers with greater consumer access through CVS Health, which includes more than 9,700 CVS Pharmacy locations and 1,100 MinuteClinic walk-in clinics as well as further extensions into the community through Omnicare’s senior pharmacy solutions, Coram’s infusion services, and the more than 4,000 CVS Health nursing professionals providing in-clinic and home-based care across the nation.
4. Additionally, the combined company will provide expanded opportunities to bring healthcare services to consumers every day. CVS Pharmacy locations will include space for wellness, clinical and pharmacy services, vision, hearing, nutrition, beauty, and medical equipment.
5. As part of the merger, three of Aetna’s directors, including Aetna’s Chairman and CEO Mark T. Bertolini, will be added to the CVS Health Board of Directors. In addition, members of the Aetna management team will play significant roles in the newly combined company.
6. Aetna will operate as a stand-alone business unit within the CVS Health enterprise and will be led by members of their current management team.
7. For shareholders, the combined company will provide enhanced competitive positioning; low- to mid-single digit accretion in the second full year after the close of the transaction, including the ability to deliver $750 million in near-term synergies; and a platform from which to accelerate growth.
8. Pending approval by CVS Health and Aetna shareholders, regulatory approvals and other customary closing conditions, the transaction is expected to close in the second half of 2018.
