- Strategically, this would be an important acquisition for them. They lost Caremark to CVS. Losing Wellpoint to Medco would make them a distant third.
- Financially, they run a very smart company. George Paz (CEO and ex-CFO) would be unlikely to pay more for an acquisition than he thought it was worth financially. Which is a good thing for shareholders.
- The questions of course that the due diligence team would be asking is what costs can be cut and when. Is there slack in the current operations or does this address capacity needs? Are there economies of scale? And, as I talked about the other day, what is the lock-in on lives?
It will be interesting to see, but it is a hot topic of discussion these days.