CVS and Aetna Complete $69.9B Deal - See the Key Deal Points

Monday, December 04, 2017


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Larry Merlo, CVS CEO

CVS and Aetna finalized their agreement. The deal still faces federal regulatory review and the impact on Rhode Island won't be known for months or longer. The potential could be transformative for the positive or negative.


CVS Health President and Chief Executive Officer Larry J. Merlo said, “This combination brings together the expertise of two great companies to remake the consumer healthcare experience. With the analytics of Aetna and CVS Health’s human touch, we will create a healthcare platform built around individuals. We look forward to working with the talented people at Aetna to position the combined company as America’s front door to quality health care, integrating more closely the work of doctors, pharmacists, other healthcare professionals and health benefits companies to create a platform that is easier to use and less expensive for consumers.” 

The deal is big. A GoLocal analysis found that a combined CVS and Aetna company will be the second largest revenue company in the United States — at $240 billion — ahead of Apple ($215B) and Berkshire Hathaway ($223B). The only company in America doing more revenue would be Walmart ($485B).

The biggest winner in the proposed acquisition of Aetna by CVS may be Rhode Island.  The deal is one of the biggest business deals in the United States will transform the company and its roll in healthcare in America.

“It positions CVS Health as a disrupter instead of the disrupted. It's obvious from our national healthcare policy debate -- and the growing number of families that can't access or afford the healthcare -- that we need transformational new healthcare business models. Tweaking today's healthcare models isn't working,” Saul Kaplan, Founder and Chief Catalyst at Business Innovation Factory told GoLocal in November.

The company said it expects to realize $750 million in "synergies" through a number of sets including reducing corporate redundancies between the two companies. The expect those saving to be realized within the first two years.

“This is the next step in our journey, positioning the combined company to dramatically further empower consumers. Together with CVS Health, we will better understand our members’ health goals, guide them through the health care system and help them achieve their best health,” said Mark T. Bertolini, Aetna chairman and CEO. “Aetna has a proud tradition of continually innovating to address unmet consumer needs and providing leading products and services to the marketplace.”

CVS in the Drivers Seat

The new combined company will be lead by CVS. According to the announcement, "three of Aetna’s directors, including Aetna’s Chairman and CEO Mark T. Bertolini, will be added to the CVS Health Board of Directors.  In addition, members of the Aetna 4 management team will play significant roles in the newly combined company. Aetna will operate as a stand‐alone business unit within the CVS Health enterprise and will be led by members of their current management team." The leadership of the combined company will be led by Merlo and other key CVS executives.


Related Slideshow: CVS - Aetna Deal - Key Slides from Deal, Dec, 2017


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