SXC Health Buys Catalyst for $4.4B as Pill Pushers Consolidate (Update 1)
(Updated to reflect analyst comments and additional data)
NEW YORK (TheStreet) -- SXC Health Solutions (SXCI) is buying Catalyst Health Solutions (CHSI) for roughly $4.4 billion in a cash and stock deal that will continue consolidation in the pharmacy drug benefits manager (PBM) space.
The merger, which values Catalyst Health Solutions at $81.02 a share, or a 28% premium to Tuesday's closing price, comes on the heels of a Federal Trade Commission approval of a blockbuster $29.1 billion acquisition of Medco Health Solutions (MHS) by Express Scripts (ESRX) earlier this month that may create the largest player in the space.
After that approval earlier, Express Scripts shares surged on expectations that the tie-up would create higher-than-expected cost savings. Traders initially viewed the latest PBM offer offer as a positive for SXC Health Solutions, pushing its shares nearly 8% higher. Meanwhile, Catalyst Health Solutions shares rose over 31% in Wednesday trading at $83.29.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV