Published - September 5, 2022 @ 12:01 PM (EET)

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CVS Health Corp. (NYSE:CVS) appears to have beaten competitors, including Amazon.com Inc. (NASDAQ:AMZN) and United Health Group Inc., to acquire the home-healthcare company Signify Health Inc. for around $8 billion.

While the two companies are in advanced talks, there is still no guarantee that CVS will reach a deal to buy Signify as Signify (NYSE:SGFY) could still receive and accept a competing bid or decide to remain independent, said a person familiar with the matter.

Since The Wall Street Journal reported in August that it was for Sale, Signify's valuation has risen sharply.  On Friday, the stock closed at $28.77, giving it a market capitalization of about $6.7 billion.

Signify, which boasts unmatched size and a well-established network of doctors that aid in house calls, has been looking for strategic options for quite some time. 

After going public in early 2021, the healthcare technology company has struggled since, with the company's shares trading below their IPO price before talks of the sales process were reported in August.

New York-based New Mountain Capital, a firm well-versed in the healthcare sector, has backed Signify since 2017 and is steadily expanding Signify through a series of mergers and acquisitions.

For CVS, a deal with Signify would make strategic sense as it could, among other things, potentially help improve care and reduce costs by ensuring patients get the necessary help after procedures to prevent new hospitalizations.

WHAT ELSE IS HAPPENING

Previously, CVS had been interested in a deal for the parent of One Medical.  However, in July, Amazon agreed to purchase the primary-care clinic operator for roughly $3.9 billion, a deal that the Federal Trade Commission is currently investigating.

1Life (NASDAQ:ONEM), which went public in 2020, disclosed the investigation in a securities filing, saying One Medical and Amazon each received a request from the FTC on Friday for additional information about the deal.

Amazon's bid for One Medical added momentum to the push by technology and retail giants to make inroads into the nation's $4 trillion healthcare economy.

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