US health insurer Cigna has announced plans to buy pharmacy benefits manager Express Scripts in a $67bn deal, including debt, marking the latest tie-up in the sector.
Connecticut-based Cigna said the cash-and-stock deal would value Express Script’s equity at $54bn, and include the assumption of roughly $15bn in the company’s debt. Express Scripts held $2.3bn in cash and equivalents at the end of 2017, according to a filing last month with US securities regulators.
The merger will “create an expanded portfolio of health services, delivering greater consumer choice, closer alignment between the customer and healthcare provider, and more personalised value,” said David Cordani, Cigna’s chief executive.
After the deal is closed, Cigna shareholders will own about 64% of the combined company.
News of the deal sent Express Scripts shares rallying 18.2 per cent in pre-market trading in New York. Cigna fell 5 per cent.
Thursday’s announcement is the latest consolidation in the industry. CVS Health, the pharmacy chain, late last year sealed a $69bn deal to buy Aetna, the insurer. Last month, grocery company Albertsons struck an agreement to buy drugstore chain Rite Aid to create a group with $83bn in annual sales.
More to come . . .