Louisville-based Humana has agreed to be sold to Connecticut-based rival Aetna for $37 billion, the companies announced early Friday.
If it goes through, the deal would mean Louisville’s largest publicly traded company by revenue would no longer be a stand-alone business.
Aetna plans to place the company’s headquarters for its Medicare, Medicaid and TRICARE businesses in Louisville, according to a joint news release from the companies. The plan is for the company to “maintain a significant corporate presence in Louisville.”
In a statement Friday morning, Mayor Greg Fischer said his administration has been in “regular contact with company leaders to understand the terms of the merger and what it means for our city and state.”
He added: “Our goal is to keep all existing jobs in Louisville and grow even more. Louisville has a depth of human talent in this important business sector and we will demonstrate that depth to the new owners. We will be fighting to grow Humana-Aetna’s presence in Louisville.”
Humana has deep roots in Louisville, including multiple office spaces downtown and a mark on philanthropy in the city, including sponsorship of the world-renown Humana Festival of New American Plays. Humana co-founder David Jones has been active individually in local philanthropy, and his son, David Jones Jr., is chairman of the Jefferson County Board of Education.
Mark Bertolini, Aetna’s chairman and chief executive, will lead the new company once the deal closes, according to the joint news release.
Bruce D. Broussard, Humana’s president and chief executive, said in a statement:
“Through the use of technology and integrated services to simplify the consumer experience, the combined entity will be even more effective in meeting the health needs of many more people — especially people with chronic conditions, who will benefit from Humana’s home health, pharmacy management, and data analytics programs. The transaction is a testament to the accomplishments of Humana associates and an outstanding outcome for our shareholders, who will receive an immediate premium and the opportunity to participate in the growth potential of the combined organization.”
Bloomberg Business reports that the deal is just part of a series of changes that will come to the health care industry.
Obamacare, or the Patient Protection and Affordable Care Act, created millions of new customers for insurance coverage and encourages insurers to look for savings. Aetna’s deal means it will gain more than 14 million Humana customers in commercial, Medicare and Medicaid plans.
Still, the deal will have to be approved by government regulators, The Wall Street Journal reports.
That means nothing is certain yet for changes in Louisville. The Journal reported recently that regulators will be scrutinizing health care industry deals such as Friday’s Aetna-Humana deal. The Journal adds that those concerns, “along with signs of some emerging operational challenges at Humana, will put pressure on Aetna and its chief executive, Mark Bertolini, to demonstrate that the huge bet will pay off.”
This story has been updated. We’ll have more coverage of the Aetna-Humana deal on 89.3 and WFPL.org later today.