is nearing a deal to buy primary-care center operator
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
(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
(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.”
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