This past Sunday CVS Health announced that it had agreed to a deal to buy Aetna for $ 69 billion. The deal would merge the drug store giant with one of the biggest health insurers in the United States. Talks of this deal had been going around for some time, mostly after it became apparent that the internet giant, Amazon, was preparing to enter the pharmaceutical market by getting pharmacy licenses in over dozen states. The deal will have a drastic change on the healthcare market. Together these two companies are in touch with most of the basic health services that people regularly use. And CVS has said that it is prepared to transform its 10,000 pharmacies and clinic locations to better meet the needs of their patients once the merger is complete.
The CVS and Aetna merger will likely pass its biggest hurdle, anti-trust laws. Since this is not a traditional merger where you have companies who are in the same industry merging together. This merger will combine two companies, that are otherwise stepping out into new territory. Anti-trust laws have stopped big mergers in the health industry before, including the Anthem and Cigna deal that would have merged the two health insurers and the proposed Aetna and Humana deal that tanked. The deal will likely move forward after regulators have looked through it. The merger is set to be one of the biggest transactions this year, and will likely transform the health industry in major ways. Recently many deals have gone under scrutiny and have tanked due to anti-trust laws, but it seems that CVS and Aetna have found a way around it. Sometimes it’s not just about growing your business organically , a strategic M&A transaction can grow your business and even help you tap into new markets like CVS and Aetna will surely do in the near future.
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