S&P changes WellCare to stable

S&P said it affirmed its BB long-term issuer credit rating on WellCare Health Plans Inc. and its BB debt rating on its senior notes.

The agency revised the outlook on WellCare to stable from positive.

S&P said the affirmation and revision follow WellCare's announcement that it reached a definitive agreement to acquire privately-owned Meridian Health Plans.

“We believe the transaction has strategic merit, as it will strengthen and expand WellCare's existing Medicaid and MA businesses and provide new PBM infrastructure and expertise,” the agency said in a news release.

At the same time, S&P said it believes the transaction carries general business integration and financing risks.

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