After a year since the announcement of there deal in December 2017, CVS Health Corp (CVS: NYSE) and Aetna (AET: NYSE) have finalized their USD 69 Billion merger. The partnership between CVS pharmacies and Aetna insurance is promising to create a health-care powerhouse.
CVS received preliminary approval from the Department of Justice for the merger in October. Prior to this CVS struggled to get final approval from state insurance regulators where Aetna sells its coverage. A small group of states opposed the partnership, out of fear it would reduce competition and could leave consumers with fewer options for health-care.
CVS was able to convince the state regulators to sign off on the acquisition, by agreeing to a number of conditions. CVS agreed to not raise premiums while also agreeing to keep premium increases at a minimum. To resolve concerns about the overlap between CVS and Aetna Medicare part D plans, Aetna said it would sell its Medicare Part D drug plan to WellCare Health plans.
Closing out the deal places Aetna's current value at $212 per share, or about USD 70 Billion, which is up from the original set value of $207 per share or USD 69 Billion. On Nov. 6, CVS reported its third-quarter earnings and is expecting to save more than USD 750 million within two years of the deal closing. Ultimately this partnership for CVS will help to achieve its main priorities, including making health care local and accessible, simplifying how consumers access to care and lowering costs.
CVS Health president and CEO Larry J. Merlo believes the combined company will create a new data-driven health-care model that's more personal, convenient and tailored to individual patients than ever before. Local CVS stores won't immediately translate the health-care changes created from the merger. However Early next year, CVS expects to start testing and adding health services in new locations.