Pharmacy and Retail giant CVS Health Corp. (NYSE: CVS) ended Friday with a second consecutive day of gains, following reports that the Department of Justice will not make any challenge to their proposed acquisition with Aetna Inc. (NYSE: AET).
Bloomberg reported on Thursday that the Department of Justice looks set to not move against the health-care companies’ mega deal valued at $69 billion. Citing trade publication Reorg Research, U.S. antitrust enforcers will not block the controversial merger.
CVS Health Corp. (NYSE: CVS) announced in December it was to acquire Aetna Inc. (NYSE: AET) in what will be one of the biggest mergers of recent years. CVS is the biggest drugstore retail chain in the U.S. with over 9000 locations spread across the U.S. and more than 1,100 walk-in medical clinics nationwide. CVS is also a major benefits manager with 94 million plan members on its books. The merger of Aetna and the Rhode Island based CVS would change the dynamics of the entire health industry in the U.S.
The news that the DoJ will not block the merger sent the CVS Health Corp. (NYSE: CVS) and Aetna Inc. (NYSE: AET) stock higher. Aetna shares gained 2.3 percent to $191.89, whilst CVS saw its stock rise from $67.48 a share to $69.31, a rise of 3.1 percent. Friday’s close of Aetna shares at $191.86 is still below the $203 a share cash plus stock deal made by CVS.
On Wednesday, CVS Health Corporation (NYSE: CVS) announced that its board of directors gave approval for a quarterly dividend of $0.50 per share on the company’s common stock. Over the last decade CVS Health Corporation (NYSE:CVS) has returned an average of 2.00 percent per year from dividend payouts. This year it is returning a 3,1 percent dividend payout. CVS Health generates dividend payout is high for Healthcare stocks but still lower than the market’s top dividend payers.