CVS Health Announces Completion Of Acquisition Of Aetna

CVS Health (CVS) announced that it has completed its acquisition of Aetna (AET). CVS Health President and Chief Executive Officer Larry J. Merlo. "By delivering the combined capabilities of our two leading organizations, we will transform the consumer health experience and build healthier communities through a new innovative health care model that is local, easier to use, less expensive and puts consumers at the center of their care... By fully integrating Aetna's medical information and analytics with CVS Health's pharmacy data, we can develop new ways to engage consumers in their total health and wellness through personal contacts and deeper collaboration with their primary care physicians. As a result, we expect patients will benefit from earlier interventions and better-connected care, leading to improved health outcomes and lower medical costs." Under the terms of the transaction, each outstanding share of Aetna common stock is being exchanged for $145.00 in cash and 0.8378 shares of CVS Health common stock.

CVS Health is not issuing any fractional shares in the transaction. Instead, the total number of shares of CVS Health common stock that each Aetna shareholder is entitled to receive is being rounded down to the nearest whole number, and each Aetna shareholder is entitled to receive cash for any fractional share of CVS Health common stock that the Aetna shareholder is otherwise entitled to receive. The transaction values Aetna at $212 per share or approximately $70B. Including the assumption of Aetna's debt, the total value of the transaction is $78B. The combined company's shares are listed on the New York Stock Exchange under the ticker symbol "CVS."

The Aetna brand name will continue to be used in reference to the health insurance products. Going forward, Aetna will operate as a stand-alone business within the CVS Health enterprise and will be led by members of its current management team. As a result of the acquisition, shareholders are expected to benefit from a number of outcomes, including enhanced competitive positioning; the delivery of more than $750 million in synergies in 2020; and a platform from which to accelerate growth. The roadmap for value creation over the longer term has the potential to deliver substantial incremental value through the development of products and services that provide the opportunity to generate significant new growth opportunities aimed at reducing medical costs, growing membership and enhancing revenues. In connection with the acquisition, on October 10, CVS Health previously announced that it had entered into an agreement with the U.S. Department of Justice that allowed it to proceed with the acquisition of Aetna.

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