CVS could buy Aetna in huge deal: ‘WSJ’

Report values insurer at more than $66B

Shares of Aetna rose sharply Thursday following a report that the insurer could be bought by pharmacy and health care company CVS Health in a multibillion-dollar deal.

The companies are in talks for CVS Healthcare (CVS) to acquire Aetna (AET) for more than $200 per share, a deal that would value the insurer at more than $66 billion, The Wall Street Journal reported, citing unidentified people familiar with the issue.

Representatives of both companies declined to comment on the report.

Aetna shares closed more than

11.5% higher at $178.60 on the news. The stock was also up fractionally in after-hours trading.

CVS shares closed more than

2.9% lower at $73.31. The company’s shares were down an additional 1% in extended trading.

CFRA Research analyst Joseph Agnese said in a Thursday note that the potential deal would make strategic sense because it would help CVS incentivize Aetna’s 23 million health plan participants to use the CVS/Caremark mail order prescription system and shop at the pharmacy company’s retail stores.

The transaction also would eliminate any risk that CVS could lose Aetna’s business, which contributed 11.2% of CVS’ consolidated net revenues in 2016, Agnese wrote.

Any acquisition agreement involving the companies would add another deal to the corporate combinations that have emerged in the health care industry in recent years.

Aetna in 2015 agreed to acquire rival health insurer Humana as part of a deal initially valued at $37 billion but abandoned the transaction in February amid antitrust concerns raised by the Obama administration.