The U.S. Department of Justice has extended its antitrust review
of health insurer WellPoint Inc.'s (WLP) $4.46 billion plan to buy
Amerigroup Corp. (AGP) while focusing on Amerigroup's Virginia
operations, the Medicaid insurer disclosed late Thursday.
This so-called second request from the DOJ isn't expected to
delay the planned closing of the deal. The companies expect to
close by the end of the fourth quarter, rather than in early 2013
as first indicated last month, Amerigroup said in a regulatory
filing.
An antitrust waiting period was set to expire late Wednesday
unless the companies received a request for more information. They
got one, which means the waiting period is now extended to 30 days
after they substantially comply, unless the DOJ terminates the
waiting period sooner.
Both companies "are working cooperatively with the DOJ staff and
representatives of the Commonwealth of Virginia to resolve any
potential concerns expeditiously," said Amerigroup, which is based
in Virginia Beach, Va.
"This request for additional information is a normal and
expected part of the regulatory process," Amerigroup said.
WellPoint, the second-largest managed-care firm by membership
after UnitedHealth Group Inc. (UNH), is buying Amerigroup as the
insurance sector increasingly looks for exposure to growing
government-based health programs like Medicaid, which covers the
poor. The deal for fast-growing Amerigroup will make WellPoint the
biggest Medicaid insurer and may help it compete for Medicaid
patients who also qualify for Medicare.
Aetna Inc. (AET) announced the latest industry consolidation
move on Monday with a $5.7 billion cash-and-stock deal to buy
Coventry Health Care Inc. (CVH), a mid-sized insurer that focuses
on commercial and government-based insurance.
WellPoint shares sank 1.4% to $57.73 Thursday and were down
slightly after hours. Amerigroup shares rose slightly to close at
$90.25. The WellPoint deal valued Amerigroup at $92 per share.
Write to Jon Kamp at jon.kamp@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires