Updated from 5:29 p.m. EST

Aetna

(AET)

, the nation's largest health insurer, said Wednesday that it had received a takeover offer from

WellPoint Health Networks

(WLP)

and the investment bank

ING Barings

.

WellPoint and an ING Barings subsidiary,

ING America Insurance Holdings

, offered $70 a share for Aetna in a cash-and-stock deal that represented a 74% premium to the company's stock price at the time. Specifically, the companies offered $44 a share in cash, as well as WellPoint stock valued at $26 a share.

The offer values the company at about $10 billion.

Aetna's shares surged 29% after news of the WellPoint emerged Wednesday afternoon.

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Aetna said that its board would review the offer and that William H. Donaldson, its chairman and chief executive officer, was reviewing the company's strategy and operation.

The Hartford, Conn.-based company has faced widespread investor dissatisfaction because of the company's depressed stock price, and its previous chief executive officer was ousted Friday.

Some analysts said the WellPoint bid seemed odd, given that Aetna's revenue is nearly triple that of WellPoint. That may be why WellPoint teamed up with an investment bank on the deal. The offer has led to speculation that the bidders might be looking toward a potential breakup of Aetna's financial services and insurance divisions.

"The allure for Wellpoint is that a deal like this would instantly make them a national player, but it's unclear whether WellPoint could provide the sort of cash infusion that Aetna's health business presumably needs," said Joseph France, a health care analyst at

Credit Suisse First Boston

, which rates Aetna a buy and has not done any underwriting for the company.

"The details are still unclear, but it's not likely that ING would pay nearly $10 billion, then just walk away with the financial side of Aetna," France said.

The offer was first made last Thursday to Richard L. Huber, who was replaced the next day as chief executive by Donaldson, an Aetna board member and a founder of investment bank

Donaldson Lufkin & Jenrette

(DLJ)

.

The company has hired a turnaround specialist, Robert S. Miller, as a special adviser to help it resuscitate its sickly stock price. Until Wednesday, Aetna had been trading near its 52-week low of 38 1/2 after reporting disappointing earnings in February, well off its high of 99 7/8.

Although Aetna did not disclose the WellPoint offer until after the regular 4 p.m. stock market close, the company's shares surged in afternoon trading after

CNBC

reported that there had been a takeover bid. When trading was halted around 3:30 p.m., etna had risen 11 7/8, or 28.9%, to 53. Trading volume in the stock was 3.9 million shares for the day, compared with average daily volume of about 1.4 million shares.

WellPoint's stock, meanwhile, fell 5 5/8, or 8.3%, to close at 61 7/8.