Aetna to Buy Coventry Health Care

Photo of Trey Thoelcke
By Trey Thoelcke Published
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

In the latest in a string of multi-billion-dollar acquisitions in the U.S. health care sector, Aetna Inc. (NYSE: AET) has agreed to buy competitor Coventry Health Care Inc. (NYSE: CVH) for $5.7 billion in cash and stock.

The Wall Street Journal reports that Aetna will pay $42.08 per share for Coventry, which is a 20.4% premium to Friday’s closing price. The boards of Aetna and Coventry have approved the deal.

U.S. health care reform act, passed in 2010, was intended to provide insurance coverage for 16 million more Americans through privately run health insurance exchanges in each state. It also will expand Medicaid eligibility for an additional 16 million people by raising limits on household income.

The acquisition of Coventry will help Aetna to lift its share of revenue from its government business from 23% to more than 30%. In July, health insurer WellPoint Inc. (NYSE: WLP) said it would acquire Amerigroup Corp. (NYSE: AGP) for about $4.5 billion, nearly doubling its Medicaid business. And last October, Cigna Corp. (NYSE: CIG) agreed to buy HealthSpring Inc. for $3.8 billion to bolster its Medicare business.

Photo of Trey Thoelcke
About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.

Featured Reads

Our top personal finance-related articles today. Your wallet will thank you later.

Continue Reading

Top Gaining Stocks

CBOE Vol: 1,568,143
PSKY Vol: 12,285,993
STX Vol: 7,378,346
ORCL Vol: 26,317,675
DDOG Vol: 6,247,779

Top Losing Stocks

LKQ
LKQ Vol: 4,367,433
CLX Vol: 13,260,523
SYK Vol: 4,519,455
MHK Vol: 1,859,865
AMGN Vol: 3,818,618