CVS beats out Amazon for Signify Health
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CVS Health has agreed to acquire Dallas value-based care enabler Signify Health for approximately $8 billion.
Why it matters: After losing out on One Medical to Amazon and watching Walgreens make bets on VillageMD and CareCentrix, CVS has finally gained a major foothold in health care delivery.
Zoom in: CVS has been outspoken about its intent to move closer to the patient, away from its historical roots. Signify moves CVS away from the pharmacy — and into the home.
- Through the deal, CVS gains access to 10,000-plus clinicians nationwide that provide health and wellness visits to nearly 2.5 million patients in the home.
How it works: Signify helps health systems and health plans move to value-based care arrangements by creating risk contracts where it shares in both upside and downside risk.
Details: CVS on Monday agreed to acquire Signify for $30.50 per share.
- New Mountain Capital, which owns a 60% stake in Signify Health, agreed to vote in favor of the transaction.
- CEO Kyle Armbrester will continue to lead Signify as part of CVS.
- BAML advised CVS, while Goldman Sachs and Deutsche Bank, as first reported by Axios, are advising Signify.
Context: This is the pharmacy retailer's largest M&A move in health care since buying Aetna in a $69 billion deal completed in 2018.
- It scooped up Caremark RX for around $27 billion in 2007.
- CVS was the runner-up for One Medical, which went to Amazon for $4 billion in July.
Of note: CVS is seeking a buyer for BSwift, the benefits technology business it acquired eight years ago, Axios reported last week.
Sarah Pringle co-authors the Axios Pro Health Tech deals newsletter. Start your free trial at AxiosPro.com.
