Shareholders have given the OK to Centene’s planned purchase of rival WellCare.
Stockholders in both insurance companies held special meetings Monday to vote on the planned merger. About 85% of Centene Corporation’s shares were represented, with 99% voting in favor of the deal.
WellCare’s meeting had 83% of its shares represented, with 99% giving their approval.
The $17 billion deal was first announced in late March, and if finalized will create one of the largest sponsors of government health plans in the nation. The combined companies would include 22 million members across all 50 states and a joint estimated revenue of $97 billion in 2019.
“With the addition of WellCare, we are creating a combined company that is better able to serve members and help them achieve better health outcomes,” Centene CEO Michael Neidorff said in a statement.
Ken Burdick, CEO of WellCare, said in the announcement that the deal provides the insurer “with an opportunity to become part of a leader in the field.”
The companies said in the announcement that they are continuing to navigate regulatory approvals in anticipation of closing the deal in the first half of 2020. This includes getting a thumbs-up from 26 state insurance agencies.
Alabama, Arkansas, Kentucky and Missouri have signed off already. Missouri requires a divestiture of some Medicaid assets as a condition of approval, Centene and WellCare said.
The merger is also under review at the Department of Justice, which has requested additional information to conduct its approval process. Centene and WellCare said they have complied with that request.
Filings with Securities and Exchange Commission show that Centene and WellCare began discussing a potential merger in the fall of last year, with several deals rejected by WellCare’s board of directors. Neidorff iced the merger in October after both companies saw their stock values decline, but talks were rekindled in January.
There were rumblings in the investment community that Humana would swoop in and acquire Centene in place of the WellCare merger, but Humana dispelled those rumors.