Wednesday, March 22, 2023
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CVS Nears Deal for Oak Street Health. Healthcare Could Be Hot for M&A in 2023.

CVS has been broadening its business beyond pharmacies and into primary-care operations.

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Bryan Bedder/Getty Images for CVS Pharmacy

is nearing a deal to buy primary-care center operator
Oak Street
Health, according to a report. It would mark the healthcare company’s second major acquisition in a matter of months. 

(ticker: CVS) is close to an agreement to acquire
Oak Street
(OSH) for about $10.5 billion including debt, The Wall Street Journal reported on Tuesday, citing people familiar with the matter. The deal is set to price Oak Health at around $39 a share, according to the WSJ. 

CVS shares were down 1.5% in premarket trading at $84. Oak Health shares were up 35% at $35.12.  

CVS and Oak Street didn’t immediately respond to requests for comment from Barron’s early on Tuesday.

A deal would mark another major acquisition for CVS after it said in September it would buy health-and-technology services provider
Signify Health
(SGFY) for about $8 billion. 

Oak Street has more than 160 sites across 21 states and focuses on the care of patients enrolled in Medicare. The deal would help deepen CVS’s primary-care business and dovetail with its Aetna health-insurance operation, as companies look to save costs by helping patients avoid costly hospital visits.

Healthcare looks set to be a standout sector for M&A after what has been a quiet period for deals, as competition is fierce among companies to broaden their patient care. 

Late last year,
Walgreens Boots Alliance
unit agreed to buy Summit Health-CityMD in a deal worth $8.9 billion to create a larger multispecialty platform.
is also pushing further into the healthcare sector after agreeing to buy medical-care company One Medical for $3.9 billion last year. 

“Given the breadth of investment types and opportunities, M&A in the [healthcare] provider and services space should gain momentum in 2023 on a global basis,” analysts at consultancy firm Bain & Co said in a market report last week. “Nontraditional players such as Amazon will continue to invest in this space to disrupt and reinvent the healthcare market, particularly in the US.”

Write to Adam Clark at


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