UnitedHealth Group to buy Catamaran for $12.78 billion

UnitedHealth Chief Executive Officer Stephen Hemsley takes part in a panel discussion titled Thomson ReutersUnitedHealth Chief Executive Officer Hemsley takes part in a panel discussion in Beverly Hills

Health insurer UnitedHealth Group unit OptumRx Corp agreed to buy pharmacy benefit manager Catamaran Corp in a deal worth about $US12.8 billion.

Catamaran, formed from the merger of SXC Health Solutions and PBM Catalyst Health Solutions in 2012, helps the administrators of group healthcare plans reduce their prescription drug costs.

UnitedHealth’s offer of $US61.50 per share represents a premium of 27 per cent to Catamaran’s Friday close on the Nasdaq.

Catamaran’s stock was trading at $US60.50 premarket on Monday, while UnitedHealth’s was up nearly 3 per cent.

After the deal, UnitedHealth expects to fill more than one billion prescriptions, the companies said.

The deal value is based on Illinois-based Catamaran’s total outstanding diluted shares as of Dec. 31.

The transaction is expected to close in the fourth quarter of 2015 and add about 30 cents per share to UnitedHealth’s profit in 2016, the companies said.

(Reporting by Sneha Banerjee in Bengaluru; Editing by Savio D’Souza)

More from Reuters:

This article originally appeared at Reuters. Copyright 2015. Follow Reuters on Twitter.

NOW WATCH: What the Chinese saying ‘The ugly wife is a treasure at home’ actually means

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.