CVS to Spin Off Retail Pharmacies From Aetna by 2028
(MENAFN) CVS Health announced Wednesday that it intends to break up its business, spinning its retail pharmacy operations off from its health insurance and pharmacy services units to form two separately traded public companies.
The company aims to finish the separation in the first half of 2028, pending final board approval and other conditions. Under the plan, CVS Health shareholders would hold stock in both companies, the company said in a statement.
The health care solutions company, which would keep the CVS Health name during the transition, would house insurer Aetna, pharmacy benefit manager CVS Caremark and specialty pharmacy unit CVS Specialty. Oak Street Health and Signify Health would also stay within it.
The second company, to be called CVS Pharmacy, would run 9,000 retail pharmacies. It would also take over the mail-order pharmacy operation, MinuteClinic and the Health100 technology services business.
David Joyner, CVS Health’s chairman and chief executive, would keep both titles at the health care solutions company. Prem Shah, currently group president, would take over as chief executive of CVS Pharmacy.
CVS Health said it expects both companies to carry investment-grade credit ratings and produce strong free cash flow. The company plans to structure the split to be tax-free for itself and its shareholders for US federal income tax purposes.
Patients and customers would keep receiving medicines, care and benefits without interruption during the transition, the company said.
The company aims to finish the separation in the first half of 2028, pending final board approval and other conditions. Under the plan, CVS Health shareholders would hold stock in both companies, the company said in a statement.
The health care solutions company, which would keep the CVS Health name during the transition, would house insurer Aetna, pharmacy benefit manager CVS Caremark and specialty pharmacy unit CVS Specialty. Oak Street Health and Signify Health would also stay within it.
The second company, to be called CVS Pharmacy, would run 9,000 retail pharmacies. It would also take over the mail-order pharmacy operation, MinuteClinic and the Health100 technology services business.
David Joyner, CVS Health’s chairman and chief executive, would keep both titles at the health care solutions company. Prem Shah, currently group president, would take over as chief executive of CVS Pharmacy.
CVS Health said it expects both companies to carry investment-grade credit ratings and produce strong free cash flow. The company plans to structure the split to be tax-free for itself and its shareholders for US federal income tax purposes.
Patients and customers would keep receiving medicines, care and benefits without interruption during the transition, the company said.
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