CVS says merger with Aetna will improve healthcare

Woonsocket, R.I.-based CVS Health announced recently that it has entered into a definitive merger agreement with Hartford, Conn.-based Aetna, under which CVS Health will acquire all outstanding shares of Aetna for a combination of cash and stock.

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.

"This combination brings together the expertise of two great companies to remake the consumer healthcare experience,” said CVS Health President and Chief Executive Officer Larry J. Merlo in a statement. “With the analytics of Aetna and CVS Health's human touch, we will create a healthcare platform built around individuals. We look forward to working with the talented people at Aetna to position the combined company as America's front door to quality health care, integrating more closely the work of doctors, pharmacists, other health care professionals and health benefits companies to create a platform that is easier to use and less expensive for consumers.”

In some of its 9,700 stores, CVS will build mini health centers that include space for wellness and clinical services, vision and hearing screening and nutrition consultation, in addition to the products and services current offered to CVS customers. Such centers will function as a “community-based health hub,” the company stated.

The merger agreement, which still needs to be approved by both companies’ shareholders as well as regulators, will streamline the management of people who have chronic health conditions, according to CVS Health.

Investors are skeptical of the deal, reported Fortune.com on Tuesday. The health insurance company’s stock closed at $178.70 on Monday — 13.67 percent below CVS’s $207-a-share cash-and-stock offer.