CVS Corp. (CVS) Gets Merger Approval
And so it ends. No, we're not talking about the men's basketball season at Duke. Rather, we are referring to the battle between CVS Corp. (CVS 33.12, -0.22) and Express Scripts (ESRX 82.66, +0.25) to merge with pharmacy benefit manager Caremark (CMX 62.62, -0.13).
"Taps" officially played for Express Scripts when Caremark shareholders voted this morning to approve the merger with CVS by an overwhelming majority according to media reports.
Today's outcome isn't a surprise as Express Scripts' fate in this battle was essentially sealed when it said last week it couldn't raise its offer without being allowed to perform confirmatory due diligence - a process it believes it was cheated from carrying out by Caremark's Board of Directors.
The unwillingness to raise its offer was the piercing death blow, but Express Scripts was already wounded by the understanding that it had not yet gained approval from regulators to merge with Caremark.
Accordingly, CVS prevailed since there was a certainty of value in its offer that called for Caremark shareholders to receive 1.67 shares of CVS stock for each share of outstanding stock they owned, plus a special cash dividend of $7.50 per share upon closing of the deal. In addition, CVS pledged to commence a cash tender offer for 150 million of its shares for $35 per share promptly following the closing of the transaction.
The new company will be known as CVS/Caremark.
--Patrick J. O'Hare, Briefing.com
"Taps" officially played for Express Scripts when Caremark shareholders voted this morning to approve the merger with CVS by an overwhelming majority according to media reports.
Today's outcome isn't a surprise as Express Scripts' fate in this battle was essentially sealed when it said last week it couldn't raise its offer without being allowed to perform confirmatory due diligence - a process it believes it was cheated from carrying out by Caremark's Board of Directors.
The unwillingness to raise its offer was the piercing death blow, but Express Scripts was already wounded by the understanding that it had not yet gained approval from regulators to merge with Caremark.
Accordingly, CVS prevailed since there was a certainty of value in its offer that called for Caremark shareholders to receive 1.67 shares of CVS stock for each share of outstanding stock they owned, plus a special cash dividend of $7.50 per share upon closing of the deal. In addition, CVS pledged to commence a cash tender offer for 150 million of its shares for $35 per share promptly following the closing of the transaction.
The new company will be known as CVS/Caremark.
--Patrick J. O'Hare, Briefing.com
posted by Stock Administrator @ 7:49 PM
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