CVS Buyout Of Aetna Could Come This Month

Nov. 21--Hartford-based Aetna Inc. could reach a buyout deal with CVS Health Corp. for $66 billion by the end of this month, Dow Jones reported Monday, citing unidentified sources.

The deal had previously been expected as early as December.

Shares closed Monday at $174.97, up 1 percent. Aetna had traded as high as $176.40 earlier in the day, still down from the CVS offer of more than $200 a share.

Dow Jones reported that the deal is being driven by the possibility of Amazon entering the pharmacy business. The deal could help CVS make better use of its retail space, selling insurance, drawing blood and other services Amazon couldn't easily match, Dow Jones said, citing unnamed people familiar with the matter.

In October, reports surfaced that Woonsocket, R.I.-based CVS was pursuing a buyout of Aetna, which earlier this year was rebuffed by government regulators in a bid to purchase rival Humana. The health insurer saw the Humana deal as a way to expand its presence in the lucrative Medicare Advantage business but regulators saw the threat of stifling competition.

A merger with CVS provides a different avenue for expansion, joining Aetna with a business where it does not have a presence.

Experts say bringing insurance and pharmacy under one corporate umbrella has the potential to cut costs between insurers and pharmacies, eliminating the so-called "middleman."

Aetna Chief Executive Mark T. Bertolini has often talked about strengthening Aetna's relationship with CVS, including leveraging CVS store footage for health care services such as diagnostic testing, dialysis, vision care and other services, while the two could develop more home health care services.

Bertolini also has said it is the insurer's goal to take a more "personalized" approach to health care. The use of data and advanced analytics will help Aetna understand more clearly each of its members, he said.

Aetna, founded in Hartford in 1853, has 4,000 workers in the city and 5,800 in Connecticut.

Earlier this year, Aetna announced plans to relocate its headquarters to New York City. The move, Bertolini said, would help the insurer tap into the "knowledge economy" as it seeks to transform itself from a traditional health insurer to a health care company.

------

UPDATES:

2:53 p.m.: This story was updated to include additional background.

___

(c)2017 The Hartford Courant (Hartford, Conn.)

Visit The Hartford Courant (Hartford, Conn.) at www.courant.com

Distributed by Tribune Content Agency, LLC.