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S&P puts WellCare on positive watch
S&P said it affirmed ratings the BB+ issuer credit ratings on Centene Corp. and placing the BB issuer credit ratings on WellCare Health Plans on CreditWatch positive.
Centene has reached a definitive agreement to acquire WellCare, S&P said.
The consolidation in the U.S. health care space shows no signs of slowing down, the agency said.
Centene announced today that it is acquiring WellCare for $17.3 billion, including outstanding debt.
Centene is planning to fund this proposed acquisition with a mix of equity and debt. Depending on equity pricing at the time of closing, S&P said it estimates this transaction would result in financial leverage of about 40% to 43%, compared to 39% as of year-end 2018, S&P said.
Centene has shown its commitment to its longer-term financial leverage target of about 40%, the agency noted.
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