CVS Health is reportedly getting close to buying Oak Street Health for about $10.5 billion in a deal that further highlights the land grab to own the primary care market in the U.S. Oak Street’s
stock was up about 33% in premarket trading on Tuesday, the day after a Wall Street Journal report said CVS may spend $39 a share to acquire Oak Street, which provides medical care to people covered by Medicare. Bloomberg had first reported that CVS was interested in buying the company in early January.
“We would expect the company to be looking at any and all available public and private primary care assets at this juncture,” Bank of America’s Michael Cherny wrote in an investor note on Tuesday. “A hypothetical acquisition of [Oak Street] would make sense to us — OSH has exposure to the strategically important, fast-growing Medicare Advantage value-based care market that CVS could further scale as part of its broader healthcare enterprise.” Shares of CVS Health
were flat in premarket trading on Tuesday. A CVS spokesperson said the company does not comment “on rumors or speculation.” The deal, if it happens, is just one of several multibillion-dollar acquisitions of primary-care companies that have been announced in the last year. Amazon
said in July it would buy One Medical
a direct primary-care provider that trades under the name 1Life Healthcare, for $3.9 billion. Walgreens Boots …