Mon, Oct. 19, 4:52 PM| Mon, Oct. 19, 4:52 PM | Comment!
Mon, Oct. 19, 3:05 AM
- Shareholders will get their say this week on two proposed health insurer mergers: Aetna's (NYSE:AET) $37B offer for Humana (NYSE:HUM), and Centene's (NYSE:CNC) $6.3B bid for Health Net (NYSE:HNT).
- Although consumer advocates have raised concerns about whether the combination will lead to less competition and higher prices, proxy advisors ISS and Glass Lewis have given both deals a thumbs-up.
- Aetna and Humana investors are scheduled to vote this afternoon and Centene and Health Net shareholders will cast their ballots on Friday.
Wed, Sep. 2, 1:29 PM
- Forbes Contributor Bruce Japsen reports that the American Hospital Association (AHA) is urging the U.S. Justice Department to closely scrutinize Aetna's (AET +1.1%) proposed $37B takeout of Humana (HUM +0.4%). The hospital lobby says the deal would give Aetna too much power to raise prices of Medicare Advantage plans, the privately run portion of the Medicare program that has seen spectacular growth over the past few years.
- Humana is the second largest insurer of Medicare Advantage while Aetna is the fourth largest. Almost one third of Medicare beneficiaries (~17M Americans) participate in Medicare Advantage.
- AHA SVP and General Counsel Melinda Hatton says, "The deal will not just eliminate current competition between Humana and Aetna, it will eliminate future competition between them. It may create monopsony and enable the merged firm to exploit small, relatively powerless providers. Second, the merger may create downstream market power which could offset the desirable effects of countervailing power and premiums to consumers. Finally, the merger might create countervailing power but the merged firm might exercise it in anti-competitive ways, harming consumers or small providers."
- It's doubtful, though, that the AHA's posturing will scupper the deal.
Fri, Jul. 24, 6:15 AM
- Anthem (NYSE:ANTM) has agreed to buy Cigna (NYSE:CI) in a deal valued at $54.2B, wrapping up a year of negotiations and creating the largest health insurer in the U.S.
- Cigna shareholders will get $103.40 per share in cash and 0.5152 Anthem shares.
- The deal comes three weeks after Aetna (NYSE:AET) struck a deal to buy Humana (NYSE:HUM) for $37B and is part of an industry-wide consolidation following the roll-out of Obamacare.
Wed, Jul. 8, 6:19 AM| Wed, Jul. 8, 6:19 AM | Comment!
Mon, Jul. 6, 8:07 AM
- In light of its merger with Aetna (NYSE:AET) Humana (NYSE:HUM) updates its Q2 and full-year 2015 guidance. For Q2, it expects non-GAAP EPS of $1.60 - 1.65 compared to its previous expectation of GAAP EPS of $2.78 - 2.83. The reduction is due to the elimination of its anticipated pretax gain from the sale of its Concentra business.
- For 2015, non-GAAP EPS is now projected to be $7.75 versus the previous range of $8.50 - 9.00.
- It target for 2016 Medicare pre-tax margin of 4.5 - 5% remains unchanged.
- The companies will host a conference call this morning at 8:30 am ET to discuss the merger.
Fri, Jul. 3, 2:51 AM
- After weeks of frenzied health insurer merger talks, Aetna (NYSE:AET) says it will buy Humana (NYSE:HUM) for about $37B, or about $230 per share.
- The deal will see Humana shareholders receive $125 in cash and 0.8375 Aetna shares for each share held, representing a premium of 23% from July 2's close.
- Following the merger, Aetna shareholders will own about 74% of the combined company.
- Previously: WSJ: Aetna very close to Humana buyout deal (Jul. 02 2015)
Thu, Jul. 2, 8:49 PM
- Aetna (AET -2.7%) is again close to a deal to buy Humana (HUM -2.9%) and it could be sealed as soon as tonight and announced this week, The Wall Street Journal reports.
- The deal -- another huge one in a big year for M&A -- would place Aetna near the top of Medicare business amid continuing industry consolidation.
- Humana shares have declined over the past two weeks, but are still up 5% from the end of May when it discussed selling itself. Aetna shares are up 8.9% over that time period.
Thu, Jun. 25, 1:47 PM
Sat, Jun. 20, 5:10 PM
- Anthem (NYSE:ANTM) has boosted its takeover offer for Cigna (NYSE:CI) and is going public with the bid after the two sides failed to reach agreement.
- Anthem's $184/share bid (cash and 31% stock) reflects a 35.4% premium to unaffected Cigna price on May 28.
- Anthem’s pursuit of Cigna comes as Cigna is eying Humana (NYSE:HUM), which has put itself up for sale, and whom now appears to be on Aetna's (NYSE:AET) radar screen.
- The five big managed-care companies are jockeying for deals that will enable them to get more efficient and better respond to changes in the healthcare landscape. Analysts say regulators will only allow one or two such combinations.
- "Anthem has been engaged with Cigna to explore a potential combination since August 2014 and is making its proposal public today following Cigna's refusal to reasonably negotiate and its insistence on securing governance matters that are not common practice in similar transactions."
- Source: press release
Sat, Jun. 20, 4:50 PM
- Aetna made proposal in past few days. Price is unclear.
- Source: WSJ
- Previously: Humana spikes 20% after WSJ report says it wants to sell itself (May. 29)
- Previously: Consolidation talk hits the health-insurance sector (Jun. 16)
Fri, May 29, 2:12 PM
- Humana (HUM +19.6%) surges following a WSJ report that it is exploring a potential sale after receiving indications of takeover interest, and has hired Goldman Sachs to help it explore a potential sale.
- Sources say Aetna (AET +2.2%) and Cigna (CI +5.2%) are among companies that have held preliminary discussions with HUM.
- HUM is one of five health insurers that bankers and analysts have long considered ripe for consolidating the industry, including AET, CI, UnitedHealth (UNH +1%) and Anthem (ANTM +2.6%).
Wed, May 13, 4:03 PM
- Humana (HUM +0.1%) spiked yesterday on the possibility that it may merge with Aetna (AET -0.3%) opined by Lerrink's Ana Gupte. Today, Sterne Agee's Brian Wright rains on the parade by saying a merger is doubtful due to Humana's premium valuation. He adds credence to his view by cutting his 2015 EPS outlook to $8.07 from $8.40 and 2016's to $9.17 from $9.71. He also cut his rating on HUM to Underperform from Neutral.
Tue, May 12, 3:57 PM
Thu, Mar. 19, 10:34 AM
- According to Bloomberg, major providers of Medicare coverage like Humana (HUM +0.9%), WellCare (WCG +0.6%) and Centene (CNC +1.4%) are high on the acquisition radar of large insurers who have relatively modest exposure to the rapidly growing Obamacare-stoked space. Likely suitors would be Aetna (AET +1.3%) and Anthem (ANTM +0.3%).
- There hasn't been much M&A activity among health insurers due to the uncertainties surrounding the implementation of the Patient Protection and Affordable Care Act. Now that its implications are better understood, the number of deals should perk up.
- No bargains are out there, though. S&P's index of health insurers galloped 57% last year. The current valuations for Humana, WellCare and Centene are $26.9B, $4.1B and $8.3B, respectively, all at record levels since at least 2007.
- Anthem CFO Wayne DeVeydt says his firm will continue to make smaller deals although a larger purchase is not out of the question. Other firms declined to comment.
- Leerink Partners analyst Ana Gupte says a likely scenario is consolidation among the five largest health insurers: UnitedHealth Group (UNH +0.8%), Anthem, Aetna, Cigna (CI +0.6%) and Humana.
- Aging baby boomers, born between 1946 and 1964, are driving the increase in Medicare enrollment. Membership is expected to rise to 68.4M in 2023, up more than 25% from this year's 54.4M. Medicaid is projected to add 9.3M people over the same time frame.
Nov. 3, 2014, 9:10 AM
- Aetna (NYSE:AET) acquires privately-held bswift, a provider of a technology platform that offers a retail shopping experience for health insurance exchanges and employers nationwide. It also provides benefits administration technology and services to employers.
- The purchase price is ~$400M and will be funded with cash on hand.
Aetna Inc. is a health care benefit company, which offers traditional and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans.
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