CVS, Aetna shareholders approve merger

WOONSOCKET – By overwhelming margins, the shareholders of CVS Health Corp. and Aetna Inc. approved the proposed merger of the retail pharmacy and benefits manager, and the health insurer at respective special meetings Tuesday.

Both meetings were conducted in New York, thus avoiding the storm that is hitting most of New England – CVS offices are closed Tuesday due to the storm.

More than 98 percent of CVS shares were voted in favor of the merger, according to a release by the company. The company expects the deal to close in the second half of 2018, subject to regulatory approvals.

Roughly 97 percent of the votes cast at the Aetna meeting voted to approve the merger, which will transfer $145 in cash and 0.8378 of a share of CVS Health to each Aetna share, a value of $207.94 based on the closing price of CVS stock on Dec. 1, 2017. As of 12:02 p.m., Aetna shares were trading at $177.30 per share, meaning that each shareholder is being paid more than $30 more per share than each share is worth at the moment.

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CVS Health expects to issue approximately 280 million shares of its common stock to Aetna shareholders in the merger. Based on the number of shares of CVS Health common stock outstanding as of Feb. 5, and the number of Aetna common shares outstanding as of Feb. 5, immediately following completion of the merger, CVS Health stockholders are expected to own approximately 78 percent of the outstanding shares of CVS Health common stock and former Aetna shareholders are expected to own approximately 22 percent of the outstanding shares of CVS Health common stock.

“When this merger is complete, the combined company will be well-positioned to reshape the consumer health care experience, putting people at the center of health care delivery to ensure they have access to high-quality, more affordable care where they are, when they need it,” said Larry J. Merlo, CVS Health president and CEO. “We look forward to delivering more seamlessly coordinated care that ensures consumers have the essential resources to lead healthier lives for themselves and their families.

“At the same time, our company will benefit from a stronger market position, with the potential to deliver increased value through the development of innovative new products and services and generate long-term growth opportunities that help produce stronger, more consistent results for shareholders as a uniquely integrated health care company,” Merlo added.

Earlier this month, CVS completed the sale of bonds to help finance the deal, netting roughly $39.4 billion.