Caremark shareholders approve merger with CVS, merger could close March 19 week

By Lisa Kerner

Charlotte, N.C., March 16 - Caremark Rx, Inc. shareholders approved the merger with CVS Corp., based on a preliminary vote count by its proxy solicitor.

A "substantial majority of outstanding shares" were cast in favor of the merger, which is expected to close during the March 19 week, according to a company news release.

CVS shareholders approved the merger at a special meeting on Thursday.

Under the CVS/Caremark merger agreement, Caremark shareholders will receive 1.67 shares of CVS/Caremark stock for each share of Caremark they own.

The tender offer for 150 million of CVS/Caremark's outstanding shares will begin about five business days after the closing, with the special cash dividend of $7.50 per share payable at or immediately following, the closing.

"We are gratified that Caremark shareholders have recognized the compelling strategic and financial benefits of this groundbreaking merger," chairman and chief executive officer Mac Crawford stated in the release.

"Caremark and CVS now have an historic opportunity to define and lead the continuing evolution of the pharmaceutical services industry and build on both companies' records of creating value for our shareholders and customers."

"We have said from the beginning that this combination will transform the way pharmacy services are delivered, enabling consumers to benefit from enhanced healthcare services and improved outcomes, and for payors to benefit from more effective cost management tools," CVS president and chief executive officer Tom Ryan said in a related news release.

"Now that we have obtained approval from both CVS and Caremark shareholders, we can begin delivering on this opportunity."

On Thursday, Express Scripts, Inc. said in a statement that it was still "firmly committed to increasing the cash portion" of its competing offer for Caremark and felt that Caremark had prevented it "from learning anything more about the company that would permit us to increase its offer absent due diligence."

At one point, Express Scripts, a St. Louis pharmacy benefit management company, was offering Caremark stockholders $29.25 in cash and 0.426 shares of Express Scripts stock for each share of Caremark stock, for an approximate value of $56.87 per share, or a total of $25 billion.

CVS is a retail pharmacy chain based in Woonsocket, R.I.

Caremark is a Nashville-based pharmaceutical services company.

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