When Express Scripts (Nasdaq:ESRX) announced its intention to acquire Medco Health Solutions (NYSE:MHS) last week, it lit the fuse on what is likely to become one of the most far-reaching (if not most interesting) developments in health care in some time. At a bare minimum, this deal is going to force the current U.S. administration to make some very interesting choices when it comes to market competition and health care costs.
The Deal
To offer a quick review, Express Scripts is proposing to acquire its larger rival (in terms of prescription share) for total consideration of $71.36 at the time of the announcement. This consideration will be broken up between $28.80 in cash and 0.81 shares of Express Scripts. Assuming the deal goes through, it will deliver Medco shareholders a 28% premium to its pre-deal price and Medco shareholders will hold about 41% of the new company.
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MHS-ESRX Merger Will Force Interesting Choice In Washington (ESRX, MHS, ABC, CAH, TEVA, UNH, WAG, CVS)
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