During Monday’s Afternoon trade, Shares of Aetna Inc. (NYSE:AET), lost -6.98% to $116.75.
Aetna Inc., and Humana Inc. (HUM) declared that they have reached a definitive agreement under which Aetna will acquire all outstanding shares of Humana for a combination of cash and stock valued at $37 billion or about $230 per Humana share based on the closing price of Aetna common shares on July 2, 2015.
The complementary combination brings together Humana’s growing Medicare Advantage business with Aetna’s diversified portfolio and commercial capabilities to create a company serving the most seniors in the Medicare Advantage program and the second-largest managed care company in the United States. The combined entity will assist drive better value and higher-quality health care by reducing administrative costs, leveraging best-in-breed practices from the two companies — counting Humana’s chronic-care capabilities that measurably improve health outcomes for larger populations — and enabling the company to better compete with more cost effective products.
Under the terms of the agreement, which has been unanimously approved by the board of directors of each company, Humana stockholders will receive $125.00 in cash and 0.8375 Aetna common shares for each Humana share. As a result of the transaction, Aetna’s shareholders would own about 74 percent of the combined company and Humana’s shareholders would own about 26 percent. Aetna anticipates to finance the cash portion of the transaction with a combination of cash on hand and by issuing about $16 billion of new term loans, debt and commercial paper. Upon closing, which is predictable to be in the second half of 2016, the company’s debt-capital ratio is projected to be about 46 percent, and administration has committed to reducing that ratio below 40 percent over the 24 months following the closing. The transaction is projected to be neutral to Aetna’s 2016 Operating EPS and produce mid-single digit percentage Operating EPS accretion in 2017 and low double-digit percentage Operating EPS accretion in 2018.
Aetna Inc. operates as a health care benefits company in the United States. It operates through three segments: Health Care, Group Insurance, and Large Case Pensions. The Health Care segment offers medical, pharmacy benefit administration services, dental, behavioral health, and vision plans on an insured basis, and an employer-funded or administrative basis.
Shares of Denbury Resources Inc. (NYSE:DNR), declined -6% to $5.48, during its current trading session, hitting its lowest level, as oil prices were falling to three-month lows.
Oil prices fell to three-month lows Monday due to worries about China’s stock market and the chance of higher oil exports from Iran, according to the Wall Street Journal.
Denbury Resources Inc. operates as an independent oil and natural gas company in the United States. The company primarily focuses on improved oil recovery utilizing carbon dioxide. It holds properties located in Mississippi, Texas, Louisiana, and Alabama in the Gulf Coast region; and in Montana, North Dakota, and Wyoming in the Rocky Mountain region.
Finally, Cliffs Natural Resources Inc. (NYSE:CLF), lost -8.68%, and is now trading at $3.53, hitting its lowest level, as the slump in iron ore prices drag down producers of the steel-making ingredient.
Iron ore prices were falling by 5.4% to $52.28 a dry metric ton, according to a price index compiled by Metal Bulletin.
Inventories at Chinese ports raised by 2.8% last week to 81.55 million tons following 11 straight weeks of declines, according to Bloomberg.
Cliffs Natural Resources Inc., a mining and natural resources company, produces iron ore and metallurgical coal. It operates five iron ore mines that produces iron ore pellets in Michigan and Minnesota; Koolyanobbing complex situated in northeast of the town of Southern Cross, which produces lump and fines iron ore; and two metallurgical coal mines located in Alabama and West Virginia.
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