CVS Health Proposes To Acquire Aetna: Eight Fast Facts

John G. Baresky

…An innovative and competitive move if the debt load can be effectively managed…

CVS and Aetna are joining forces as an optimistic pharmacy, PBM and managed care organization powerhouse!
CVS and Aetna are joining forces as an optimistic pharmacy, PBM and managed care organization powerhouse!
…Mergers And Acquisitions Propel Healthcare Industry Business Model Changes…

The healthcare industry continues to evolve; business models within the sector are changing and propelled by large scale merger and acquisition initiatives; CVS and Aetna exemplify this

The proposed CVS Health / Aetna deal combines two healthcare industry leaders with wide and deep reach across commercial and consumer business sectors nationwide. Both organizations are well-established and as a combined tandem, represent a significant competitive threat to Centene, Cigna, Express Scripts, Fred’s Pharmacy, Humana, Kaiser, Optum / UnitedHealth Group, Prime Therapeutics, Rite Aid, Walgreens-Boots Alliance, Walmart and select Blue Cross Blue Shield plans (CVS Health recently formed a strategic alliance, IngenioRx, with Anthem, the largest BCBS affiliate).

CVS has grown organically and through strategic acquisitions
CVS has grown organically and through strategic acquisitions
The CVS brand continues to build a strong consumer, clinical, payer reputation with the acquisition of Aetna

Eight fast facts about the CVS acquisition of Aetna

  1. CVS Health ( NYSE: CVS ) will pay about $69 billion for Aetna; Aetna stockholders will receive $207 per share, $145 in cash and $62 in stock
Aetna will funnel business into CVS and CVS will help Aetna retain and gain new business
Aetna will funnel business into CVS and CVS will help Aetna retain and gain new business
Aetna will be a catalyst to drive CVS growth

A CVS / AETNA tandem would be a disruptive and influential force across U.S. healthcare

The CVS Health / Aetna deal is also viewed by some as a preemptive move in anticipation of the various strategies Amazon may deploy in its widening entry into the healthcare sector. Optum / UnitedHealth Group has already undertaken an assertive strategy to diversify its business model through strategic acquisitions of physician practice groups. These include buying Surgical Care Affiliates ($2.3 billion) and DaVita’s medical group ($4.9 billion).

Antitrust concerns are paramount for acquisitions in the healthcare provider and healthcare insurance sectors

Regulators will carefully assess the proposed arrangement from multiple perspectives. If approved, CVS Health and Aetna will be busy with executing integration initiatives to optimize the combined attributes of their new company.

To finance the deal, CVS Health reportedly plans to issue $44.8 billion in new debt plus $21 billion in new equity and deploy about $4.1 billion of cash on hand.

CVS Health is taking on about $8 billion of Aetna debt which will stack on to CVS Health’s current debt of almost $23.5 billion. Cost-cutting and other financial belt-tightening measures will get underway quickly if regulators grant their approval; these will challenge the new company to effectively compete while equally meeting customer service and shareholder expectations.

Undoubtedly, CVS Health / Aetna competitors will be assessing their business models and strategically evaluating their merger & acquisition options moving forward.

Thank you for reading this story

Learn more about the healthcare industry; read my articles about its medical and business trends, content marketing and digital strategy, brand and product management, mergers and acquisitions, consumer wellness, managed care and market access strategy.

About me

Hi, my name is John Baresky ( pronounced “ buh — ress — key “) and I have over 25 years of experience in healthcare.

Throughout my career, I have been writing about healthcare while developing and sharing important information with physicians, nurses, pharmacists and other clinicians plus consumers, patients, healthcare business professionals, investors and other stakeholders.​​

Healthcare is a vast industry. I organize its clinical, business, academic, technical and consumer topics into precise messages and stories that are easily understood and immediately useful. The content I write resonates across audiences with objective accuracy and clarity.

Visit my website and connect with me via LinkedIn and Twitter


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John G. Baresky


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…CVS Health and Aetna Image courtesy of the Washington Examiner…

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