CVS Health Corp. is moving closer to a deal to buy Aetna Inc. for more than $66 billion in cash and stock. The deal, which could be announced by Monday, would create a health-care-industry behemoth selling everything from drugs to insurance.
The companies are in advanced stages of negotiating a deal, according to people familiar with the matter. It would likely be valued at between $200 and $205 per Aetna share and be comprised mainly of cash, some of the people said. The cash-stock mix has yet to be finalized and Aetna has been pushing for more cash, they added.
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It is still possible the timing could slip or that the companies will fail to reach a deal.
Aetna shares closed Wednesday at $179.57. The stock was trading at about $160 when The Wall Street Journal reported on the possibility of a deal with CVS on Oct. 26, meaning that a price of over $200 a share would represent a premium of more than 25%.
It would be the biggest merger deal inked this year and the largest since AT&T Inc. agreed to buy Time Warner Inc. for about $85 billion in October 2016.
Shares of Woonsocket, R.I.-based CVS, which sunk in the days after news of the possible deal surfaced, have since recouped that loss and then some. The company's market value now stands at about $74 billion.
CVS comprises a chain of nearly 10,000 drugstores and a big pharmacy-benefits manager, or PBM, that selects which drugs are covered for patients and negotiates discounts with drugmakers.
Aetna, based in Hartford, Conn., is a major health insurer. A deal for the company, culminating months of talks, would lock in a huge number of members for CVS's PBM as well as potential customers for its drugstores. That could bolster its leverage in negotiations with drugmakers.
The tie-up would also further efforts by CVS to move deeper into health care and enable it to pitch a unified, seamless benefits offering to clients such as big employers.
Moves Amazon.com Inc. has made to potentially enter the pharmacy business stoked CVS's interest in diversifying through a deal with an insurer, people familiar with the matter have said.
A CVS-Aetna deal almost surely would attract close scrutiny from U.S. antitrust enforcers who have expressed concern about health-care consolidation. The Justice Department's recent move to block the AT&T-Time Warner deal has caused some investors to worry already about the fate of a CVS-Aetna merger proposal.
Sharon Terlep contributed to this article
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(END) Dow Jones Newswires
November 30, 2017 12:02 ET (17:02 GMT)