US health insurance deal action as Centene buys Health Net, Athem and Cigna talk merger

US health insurer Centene has agreed to acquire rival Health Net for $6.3bn, while elsewhere in the sector reports suggested Anthem and Cigna had met for merger talks.

Missouri-based Medicaid provider Centene will pay a mixture of cash and stock for California-based competitor, with the acquisition price of $78.57, a 21%-premium to the previous day's closing price.

Ana Gupte, an analyst at Leerink, suggested in a note to clients on Thursday that it was possible UnitedHealth could attempt to launch a competing bid for Health Net.

The health insurance sector has been abuzz with merger and acquisition (M&A) moves in recent months, with UnitedHealth moving in on Aetna and widespread reports that Humana Inc is a target.

The Wall Street Journal reported that Anthem and Cigna had begun talks about a potential merger just weeks after Cigna rebuffed a $47.5bn takeover.

Representatives of the companies met in recent days to discuss a potential combination, according to a source quoted by the paper, with a deal possible this month.

Companies in the sector are looking to make hay having benefited from a surge of new business as the Patient Protection and Affordable Care Act pushed previously uninsured people into the market.

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