CVS buys home health giant Signify Health for $8 billion
The CVS logo is displayed in one of their stores near Bloomsburg.
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The companies said Monday that CVS Health has reached a deal to acquire home healthcare company Signify Health for about $8 billion.
CVS said it will pay $30.50 per share in cash to Signify, an acquisition that will build on its growing healthcare services. Signify provides technology and analytics to help care for patients at home.
“This acquisition will enhance our connection with consumers at home and enable providers to better meet the needs of patients as we implement our vision to redefine the healthcare experience,” Karen Lynch, President and CEO of CVS Health, said in a press release.
The deal comes as competitors from Amazon to Walgreens are moving into the healthcare sector. In July, Amazon announced that it had acquired primary care provider One Medical for $3.9 billion.
Shares of Signify Health are up nearly 45% over the past month to give it a market value of about $6.7 billion at $28.77 per share as of Friday’s close, according to FactSet. The Wall Street Journal reported on August 2 that Signify was exploring strategic alternatives, including selling.
Shares of Signify, which went public in February 2021, surged in late August after reports that Amazon was among the bidders.
Last month, CVS revealed plans to acquire or take a stake in a primary care company by the end of the year.
The Signify deal follows acquisitions and other transformations in the primary healthcare space. CVS previously acquired insurance company Aetna and pharmacy benefits manager Caremark, and customers can get vaccinations or urgent care at MinuteClinic locations within its stores. I recently offered mental health therapy in some stores.
The companies expect the acquisition, which is subject to regulatory approval, to close in the first half of next year.
The two companies said private equity firm New Mountain Capital owns about 60% of Signify’s common stock and agreed to back the deal.
CVS Health and Signify Health will hold an analyst and investor call at 8:30 a.m. ET on Tuesday to discuss the transaction.