Catalyst Health Solutions said on Wednesday that it had agreed to buy the prescription benefits management unit of Walgreens for $525 million in cash, part of a broader consolidation wave among pharmacy health care providers.
By buying the Walgreens unit, Catalyst expects to increase the number of its prescription benefits customers to 18 million from 7 million, while raising the number of covered prescriptions to more than 165 million from 80 million.
The takeover is the latest in the prescription benefits industry. In 2007, CVS pulled off the biggest such deal when it acquired CareMark Rx for $26.5 billion.
The Walgreens deal is expected to close in the first half of the year.
Catalyst has received loan commitments from Goldman Sachs, Citigroup, SunTrust and Wells Fargo, though the company said it might also sell stock and use existing cash and credit lines to finance the deal.
Catalyst was advised by Citigroup, Goldman Sachs, Jefferies & Company and the law firms Latham & Watkins and Mintz, Levin, Cohn, Ferris, Glovsky and Popeo. Walgreens was advised by Bank of America Merrill Lynch and the law firms Sidley Austin and Weil, Gotshal & Manges.
By buying the Walgreens unit, Catalyst expects to increase the number of its prescription benefits customers to 18 million from 7 million, while raising the number of covered prescriptions to more than 165 million from 80 million.
The takeover is the latest in the prescription benefits industry. In 2007, CVS pulled off the biggest such deal when it acquired CareMark Rx for $26.5 billion.
The Walgreens deal is expected to close in the first half of the year.
Catalyst has received loan commitments from Goldman Sachs, Citigroup, SunTrust and Wells Fargo, though the company said it might also sell stock and use existing cash and credit lines to finance the deal.
Catalyst was advised by Citigroup, Goldman Sachs, Jefferies & Company and the law firms Latham & Watkins and Mintz, Levin, Cohn, Ferris, Glovsky and Popeo. Walgreens was advised by Bank of America Merrill Lynch and the law firms Sidley Austin and Weil, Gotshal & Manges.
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