Centene to Buy Health Net in $6.3 Billion Health-Care Deal

via Bloomberg/Yahoo News

Centene Corp. agreed to buy Health Net Inc. for about $6.3 billion in cash and stock, creating a combination of two smaller U.S. health insurers ahead of an expected round of mergers among the industry’s giants.

Health Net investors will get 0.622 shares of Centene and $28.25 in cash for each share they hold, the companies said in a statement on Thursday. The implied price of $78.57 a share is 21 percent more than Health Net’s closing stock price Wednesday.

The deal gives Centene the biggest market share among private administrators of Medicaid, the federally funded health program for the poor — a bet that the U.S. government will keep playing a larger role in health care. The transaction would give Centene a bigger presence in the California Medicaid program, which is the largest in the U.S. with more than 12 million individuals, and provides an entry into the Medicare market..

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Eric is a Producer at Lockton Insurance Brokers, Inc., the world’s largest privately held commercial broker. Eric has over 23 years of experience in the insurance industry and has spent the last 11 years with Lockton. Eric specializes in Health & Welfare Benefits, Retirement Planning, and Executive Benefits. Eric's clients utilize his expertise in the areas of Plan Due Diligence, Transaction Structure, Fiduciary Oversight, Investment Design, Compliance and Vendor negotiation to improve the operational & financial outcome for each client. The Benefit Blog is a place to share that expertise and industry news.
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