2017.12.0400:05:00UTC+00CVS to Acquire Aetna in $69 Billion Deal

CVS Health Corp. said that it had agreed to buy health insurer Aetna Inc. for $69 billion, as it looks to address the surging cost of healthcare via lower-cost medical services in pharmacies.

The biggest corporate acquisition to date this year will merge one of the biggest pharmacy benefits managers of the U.S. and pharmacy operations with one of its oldest health insurers, whose national business ranges from employer healthcare to government plans.

Aetna shareholders will receive $207 per share in the agreement with CVS, the firms said. The consideration is made up of $145 per share in cash and 0.8378 CVS shares for each Aetna shares. After the deal, Aetna shareholders will own around 22 percent of the merged firm, while CVS shareholders will own the remaining portion.

The firms said that the cost synergies in the second financial year after the end of the deal would result to $750 million. The companies projects it will add to adjusted earnings per share by the low- to mid-single digit percentage points.

The company anticipates to spend billions of dollars in the following years to increase the number of clinics and services, mostly funded by moving funds away from other investments.