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.
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