Walmart Inc., a reputed brand name across the retail business, is reportedly carrying out preliminary discussions to acquire Humana Inc., a U.S. based health insurance firm. This seems to be a shift in its business strategy and is likely to emerge as one of the most profitable deals in the healthcare service sector.
An acquisition of this kind does not seem to be novel, say industry experts. In December last year, CVS Health Corporation, a U.S. based retail pharmacy & healthcare firm, had declared to acquire Aetna Inc., an American health insurance firm, for USD 69 billion. The successful acquisition of Humana will be a huge deal for Walmart since 1999, when the retail giant acquired UK’s Asda Group PLC.
The share price of Humana Inc., increased by nearly 13% after the reports pertaining to the possible acquisition of Humana by Walmart went viral. At the end of Thursday, it was reported that the market value of the total shares of Humana was nearly USD 37 billion, a rise of nearly 30% as compared to last year. Reportedly, the share price of Walmart has increased by over 25% since the news outbreak stating the possible acquisition deal between Walmart and Humana.
It is being speculated that in the event the acquisition deal between Walmart & Humana is finalized after receiving the approval of investors and regulatory authorities, Walmart will become one of the largest healthcare insurance firms across the U.S. Amidst a scenario where the U.S. government has been holding different opinions over the country’s healthcare policies, this acquisition is certain to help Walmart emerge as the most reliable firm in the nation’s healthcare insurance sector.
The ongoing discussions between Walmart and Humana depict the current trends witnessed across the healthcare sector, where medical firms have been collaborating with various retail companies. The collaborations focus on diversifying the businesses in the wake of fierce competition from eCommerce firms such as Amazon Inc., say sources.