Humana executives reported that of the 129,240,721 shares voting at the offices of its New York City law firm, more than 99 percent voted in favor of the adoption of the merger agreement. Two Humana shareholders filed a lawsuit to stop the merger from going through last week. The registration statement was declared effective by the SEC on August 28, 2015, and Aetna and Humana commenced mailing the definitive joint proxy statement/prospectus to shareholders of Aetna and stockholders of Humana on or about September 1, 2015.
In another potential merger, shareholders are expected to vote on Centene’s $6.3 billion offer for Health Net, two companies that specialize in government-subsidized health plans.
Shares of Aetna (NYSE:AET) traded up 1.46% during mid-day trading on Monday, hitting $114.64. Aetna CEO Mark Bertolini faced a hearing last month in front of the Senate Judiciary Committee’s antitrust subcommittee along with Anthem CEO Joseph Swedish, whose company is trying to buy Cigna in a $54 billion deal.
Aetna’s $37 billion acquisition of Humana still needs approval of federal regulators and that won’t be without a challenge as doctors, hospitals and consumer groups have already urged the U.S. Justice Department to closely scrutinize the deal. It still faces stringent regulatory and anti-trust reviews by states and federal authorities. The company provides electric utility services to customers in the paper, foundry, food products, and machinery production industries, in addition to to the retail chains. Providers have expressed concern over potentially being left out of narrow networks. “The power of the insurers is becoming ever stronger”, said Dr. Bill Bithoney, managing director at BDO Consulting and former chief medical officer for several large health systems. “The risk of being excluded from the network is a real danger”. According to Bithoney, most insurance markets have just three or fewer insurance companies. The AMA said at the time, insurance competition would be significantly reduced in 97 metropolitan areas spread across most states. He said, “Everyone’s afraid”, he added, “It’s an ever-escalating merger-mania” (Modern Healthcare, 10/19).
The Aetna and Humana deal comes amid a wave health insurance industry consolidation.
