Business

CVS to buy Signify Health in deal pushing beyond retail

Pharmacy chain is acquiring Signify for $30.50 a share in an all-cash deal, according to a statement

CVS and Signify said they expect their transaction to close in the first half of 2023. Photograph: EPA

Tue Sep 6 2022 - 15:04

CVS reached a deal to buy home-health and technology services provider Signify Health for about $8 billion (€8.1 billion), as the pharmacy chain continues to expand beyond its retail origins.

CVS is acquiring Signify for $30.50 a share in an all-cash deal, according to a statement Monday. The company emerged as the winning bidder over potential suitors that had included UnitedHealth Group, Amazon and Option Care Health.

Through its software and services, Signify aims to help clients — payers such as health plans, government programmes and employers — shift to value-based payment plans. It’s backed by New Mountain Capital, which formed the company in 2017.

Signify’s network has more than 10,000 clinicians in all 50 states in the US.

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“Signify Health will play a critical role in advancing our healthcare services strategy and gives us a platform to accelerate our growth in value-based care,” CVS health chief executive, Karen S Lynch, said in the statement. “This acquisition will enhance our connection to consumers in the home and enables providers to better address patient needs as we execute our vision to redefine the healthcare experience.”

The acquisition ranks among the biggest for CVS as it has broadened its healthcare footprint. Its largest was its purchase of insurer Aetna in a deal valued at $68 billion including debt. That transaction, completed in 2018, followed its 2007 acquisition of Caremark for about $27 billion.

CVS and Signify said they expect their transaction to close in the first half of 2023.

Signify shares were little changed at $28.78 in early trading in New York, while CVS fell less than 1 per cent. — Bloomberg

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