As it turns out, Aetna‘s shareholders appear to fully support the insurer's plan to take part in the consolidation sweeping its industry.
Shares of Aetna jumped as much as 5 percent on Monday after the company announced its $5.7 billion planned takeover of Coventry Health Care, and in late morning trading they were still up 4 percent, at $39.56.
Shares of Coventry, as one might expect, climbed 18.7 percent, though at $41.47 they remained below Aetna's offer price of about $42.08.
In a statement, Aetna said it was seeking to bolster its core insurance business, as well as expand its offerings in the Medicare and Medicaid programs. It is the latest such deal announced since the Obama administration won passage of its sweeping expansion of health care coverage.
The takeover of Coventry is the biggest deal in the managed health care space since the core of the industry overhaul, the Affordable Care Act, was signed into law on March 21, 2010, accordin g to data from Standard & Poor's Capital IQ. Here is the list of deals:
| Source: Capital IQ | |||
| Aug. 20, 2012 | Coventry Health Care | Aetna | $5.7 billion |
| July 9, 2012 | Amerigroup | WellPoint | $4.9 billion |
| May 21, 2012 | HealthCare Partners | DaVita | $4.7 billion |
| Oct. 24, 2011 | HealthSpring | Cigna | $4.2 billion |
| July 9, 2010 | MultiPlan | BC Partners and Silver Lake | $3.1 billion |
Analysts largely praised Aetna's move as sensible. Analysts at JPMorgan Chase wrote in a research note on Monday that Coventry would enhance the company's presence in markets like Florida, Kentucky and western Pennsylvania.
They added, however: “While certainly enhancing, we don't see this as a game change r in terms of government focused capabilities for Aetna going forward.â€
