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Centene’s Acquisition of WellCare Health Plans: The Must-Knows

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Acquisition announcement

Today, Centene (CNC) issued a press release announcing its plan to acquire WellCare Health Plans (WCG) for a total consideration of $17.3 billion. WellCare Health Plan shareholders are expected to receive implied cash and stock consideration worth $305.39 per target share, based on Centene’s closing price on March 26.

Share price movements

After the deal announcement, Centene is trading at $51.06, which is 6.91% lower than its previous closing price, 2.12% higher than its 52-week low price of $50.00, and 31.45% lower than its 52-week high price of $74.49.

Based on its closing price on March 26, Centene had reported returns of -8.54% in the last week, -14.32% in the last month, and -2.50% in the last quarter. The company has reported returns of -23.13% in the last half year, 8.11% in the last year, and -4.86% year-to-date.

On the other hand, WellCare Health Plans is trading at $253.81, 9.75% higher than the previous closing price, 34.78% higher than its 52-week low price of $188.32 and 21.90% lower than the 52-week high price of $324.99.

Based on its closing price on March 26, WellCare Health Plans had reported returns of -7.37% in the last week, -16.23% in the last month, and 2.12% in the last quarter. The company has reported returns of -24.00% in the last half year, 22.75% in the last year, and -2.04% year-to-date.

The drop in share prices for Centene may indicate investor concerns about the deal. Merger arbitrage may have also resulted in selling pressure for Centene and increased demand for WellCare Health Plans.

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