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CVS Health to acquire home-healthcare firm Signify Health for $8Bn

CVS Health to acquire home-healthcare firm Signify Health for $8Bn

American healthcare giant CVS Health has reportedly cracked a deal worth $8 billion to acquire in-home healthcare firm Signify Health for around $8 billion, confirmed the two companies on Monday.

CVS stated that it would pay as much as  $30.50 per share in cash for the acquisition and that Signify would help build the company’s increasing healthcare services.

Signify offers analytics and technology for assisting in-home patient care.

Karen Lynch, President and CEO, CVS Health, stated in a news release that the acquisition would boost its connection with consumers at home and allows providers to address the patients’ needs better while its carries out its vision of redefining the healthcare experience.

Through the deal, CVS was able to outbid its competitors, which ranged from Walgreens to Amazon, venturing further into the healthcare sector. Earlier in July, Amazon announced the acquisition of primary-care provider One Medical for nearly $3.9 billion.

Over the last month, Signify Health’s share jumped almost 45%, giving it a market value of around $6.7 billion, with $28.77 for each share on Friday’s close.

On 2nd August, the Wall Street Journal reported that the healthcare platform was looking into strategic alternatives, which also included a sale.

Signify, which went public in February last year, saw its shares rise in late August following reports of Amazon being one of the bidders.

Earlier in August, CVS disclosed plans for acquiring or taking a stake in any primary-care firm by the end of the year.

CVS has been making acquisitions and shifts into primary healthcare. It had previously acquired pharmacy benefits manager Caremark and insurer Aetna. Customers are now able to get vaccines or any urgent care at the MinuteClinic outposts set inside its stores.

CVS also introduced therapy for mental health at some of its stores.

Both Signify and CVS expect the acquisition, subject to regulatory approval, to be completed by the first half of 2023.

The two added that New Mountain Capital, a private equity company owning almost 60% of Signify’s common stock, has agreed to back the deal.

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Meghna Singh

An English Literature graduate, Meghna Singh ventured into the profession of content development to incorporate her knack for writing articles across verticals including technology, healthcare, business, and alike for News Origins and Newsorigins. She has also completed her MBA in Tourism and worked as a content creator in the field of product development.