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Robert Trigaux

Tampa's WellCare: A '30 to 50 percent chance' of being acquired in next year



wellcarelogo.Wake up and good morning. Tampa Bay's third largest public company -- Medicare health insurer WellCare Health Plans Inc. -- increasingly is a takeover target. So says this Oct. 26 Bloomberg news story. It says giant insurer Aetna Inc. suffers from a dearth of Medicare customers as baby boomers reach retirement age. And that, the story says, puts Tampa's Medicare-rich WellCare among the top of a few choice takeover targets.

WellCare has a 30 to 50 percent chance of being acquired in the next 12 months, Robert Boroujerdi, New York-based Goldman Sachs Group’s co- director of Americas equity research, wrote in a report last week.

WellCare has more than a million Medicare customers between Medicare Advantage and Medicare Part D, data compiled by Bloomberg show. The insurer would give a buyer like Aetna a presence in more states and an expanded portfolio of both Medicare and Medicaid, the joint federal-state program for low income Americans, Tom Carroll, an analyst at Stifel Nicolaus & Co. in Baltimore, told Bloomberg.

"WellCare would be an extremely strategic acquisition to gain access to a bigger piece of government business," Carroll said. "It should also be a willing seller" -- though the story does not explain why. Read more about WellCare here. WellCare spokeswoman Amy Knapp told Bloomberg it's "not appropriate" for the company to comment on rumors or speculation. "We are focused on serving our members, growing our business and helping our government customers effectively manage their rising health care costs," she stated.

WellCare got caught in an FBI raid and subsequent fraud quagmire years ago. It's since changed top management. Its board of directors includes former Florida governor and U.S. senator Bob Graham.

Should WellCare be bought, it would be another blow to Tampa Bay's already lean bench of public corporations of size headquartered in this area.

 -- Robert Trigaux, Business Columnist, St. Petersburg Times



[Last modified: Wednesday, October 26, 2011 6:50am]


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