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US: Centene to buy smaller rival WellCare for $15.27 billion

 |  March 27, 2019

US health insurer Centene confirmed on Wednesday that it would buy WellCare Health Plans in a cash-and-stock deal to bulk up its government-backed health-care business, valuing its smaller rival at $15.27 billion.

Reuters had reported on Tuesday that the companies were in advanced talks over a deal.

The acquisition would likely reduce Centene’s dependence on the Obamacare health-care exchanges at a time when the Trump administration has stepped up its assault on former President Barack Obama’s signature health-care law.

Earlier this week, the Department of Justice (DOJ) backed a federal judge’s ruling that Obamacare violated the US Constitution because it required people to buy health insurance.

Centene relies on its Obamacare business for about 40 percent of its earnings, making it vulnerable to the DOJ decision, according to SVB Leerink analyst Ana Gupte.

Full Content: Reuters

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