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Proposed Acquisition of Aetna | 9 Months Ended
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Sep. 30, 2018
Proposed Acquisition of Aetna |
Proposed Acquisition of Aetna | Note 2 – Proposed Acquisition of Aetna On December 3, 2017, the Company entered into a definitive merger agreement to acquire all of the outstanding shares of Aetna Inc. (“Aetna”) for a combination of cash and stock. Under the terms of the merger agreement, Aetna shareholders will receive $145.00 per share in cash and 0.8378 CVS Health shares for each Aetna share. The transaction values Aetna at approximately $207 per share or approximately $69 billion based on the Company’s 5-day volume weighted average price ending December 1, 2017 of $74.21 per share. Including the assumption of Aetna’s debt, the total value of the transaction is approximately $77 billion. The final purchase price will be determined based on the Company’s stock price on the date of closing of the transaction. The proposed transaction was approved by stockholders of CVS Health and shareholders of Aetna at meetings held on March 13, 2018. On October 10, 2018, the Company and Aetna entered into a consent decree with the United States Department of Justice (“DOJ”) that allows the Company’s proposed acquisition of Aetna to proceed, provided Aetna agreed to sell its individual standalone Medicare Part D prescription drug plans. As part of the agreement reached with the DOJ, Aetna entered into an asset purchase agreement with a subsidiary of WellCare Health Plans, Inc. for the divestiture of Aetna’s standalone Medicare Part D prescription drug plans, which have an aggregate of approximately 2.2 million members. Closing of the divestiture is subject to the closing of the Company’s proposed acquisition of Aetna. The required asset preservation stipulation and order was entered by the U.S. District Court for the District of Columbia on October 25, 2018. There are no remaining antitrust impediments to closing the proposed acquisition of Aetna. The proposed acquisition of Aetna remains subject to customary closing conditions, including the approvals of state departments of insurance. If the transaction is not completed, the Company could be liable to Aetna for a termination fee of $2.1 billion in connection with the merger agreement, depending on the reasons leading to such termination.

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