CVS closes on $69 billion acquisition of Aetna

Nov. 28--CVS Health Corp. has closed on its $69 billion acquisition of Hartford health insurer Aetna Inc., the Rhode Island pharmacy giant announced Wednesday.

"Today marks the start of a new day in health care and a transformative moment for our company and our industry," Chief Executive Officer Larry Merlo said.

The combination will provide a "new innovative health care model that is local, easier to use, less expensive and puts consumers at the center of their care," he said.

The combined company will link consumers to the retail prescription and health products sold by CVS and its walk-in health service centers known as Minute Clinics and Aetna's network of providers.

The new company can develop ways to engage consumers in their health and wellness through personal contacts and "deeper collaboration" with primary care physicians, Merlo said.

"As a result, we expect patients will benefit from earlier interventions and better-connected care, leading to improved health outcomes and lower medical costs," he said.

Independent pharmacists and some consumer groups have criticized the deal, saying it will lead to a monopoly in health care and pharmacy products.

Shares of CVS rose about 2 percent, to $81 in afternoon trading. Aetna was up a fraction of 1 percent, at $212.86.

The deal, which was announced Dec. 3, 2017, was promoted as a way to integrate the work of doctors, pharmacists, other health care professionals and health benefits companies to establish a platform easier to use and less expensive for consumers.

Analysts said business considerations and a push to stem rising health care costs are behind the deal.

The future of Aetna's presence in Hartford was immediately in doubt. But CVS announced in January it will keep Aetna in the city, which has been home to the insurer since 1853.

Hartford will be one of several hubs, or centers of excellence, as CVS calls the sites. Others operate in Arizona, Illinois and Texas.

Aetna will operate as a stand-alone business in the CVS Health enterprise.

Each outstanding share of Aetna common stock is being exchanged for $145 in cash and 0.8378 shares of CVS Health common stock.

The transaction values Aetna at $212 per share or approximately $70 billion. Aetna closed Tuesday at $212.

Including Aetna's debt that CVS assumes, the deal's total value is $78 billion.

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