CVS Health Corp. plans to bid to acquire Dallas-based Signify Health Inc. as part of its expansion into home health services. wall street journal This was reported by a person familiar with the matter.
CVS, which offers drugstores and health insurance, is one of the companies looking to submit the first bids this week. journal reported on Sunday.of journal Signify, which had a market capitalization of $4.66 billion as of Friday, said it was exploring strategic options, including a potential sale.
There is no guarantee that this activity will result in a sale of Signify. journal report. Representatives for CVS and Signify declined to comment on the deal speculation in an email to Bloomberg.
Acquiring a home health care company aligns with CEO Karen Lynch’s goal of moving CVS into more types of direct-to-patient care. Amazon.com’s acquisition of primary care clinic One Medical has intensified competition.
“We’ve been thinking carefully about our approach of meeting customers through their homes, communities and digital connections,” Lynch said in an interview with Bloomberg News last week. It’s about meeting in person at a place.”
Signify has a platform that uses technology and analytics to support home care providers.
The company announced in July that it was exiting the health insurance lump-sum payment business. The company estimated that this would cost it up to $35 million in severance payments and other employee payments.
Signify said it plans to focus on home health care, which it believes is a rapidly growing and more profitable area. After the outbreak of the COVID-19 pandemic, health care providers have seen increased demand for home services, especially for vulnerable people who do not feel safe going to doctors or hospitals for fear of contracting the virus. I noticed that there is
Signify’s home and community services division, which was bolstered by its $250 million acquisition of Caravan Health earlier this year, is benefiting from this increased demand. The company provides remote patient monitoring, distribution channels, member engagement, and care optimization for healthcare providers who provide home health care.
The agreement with Caravan Health brings together two companies focused on value-based payment models ranging from advanced primary care to specialty care bundles to total care contracts. Signify CEO Kyle Armbrester told Fierce Healthcare at the time that he provided over two million homes with a large network of doctors, nurses and licensed social care workers. increase.
“What we are building will ultimately be what the healthcare system really enables value-based care,” Armbrester told the publication.
Signify’s stock is up 40% so far this year, closing at $19.87 on Friday.
Signify will generate $773.4 million in revenue in 2021, up 27% from 2020. Last year, he went public with a market capitalization of $7.12 billion after raising $564 million on day one.
Research by Kevin Miller and Julie Johnson, Bloomberg, The Dallas Morning News.