CVS Health Corporation (NYSE:CVS) (‘CVS') entered into a definitive merger agreement to acquire Aetna Inc. (NYSE:AET) for $68 billion on December 3, 2017. Under the terms of the merger agreement, each outstanding share of Aetna common stock will be exchanged for $145 in cash and 0.8378 shares of CVS common stock. Upon closing of the transaction, Aetna shareholders will own approximately 22% of the combined company and CVS Health shareholders will own approximately 78%. CVS intends to fund the cash portion of the transaction through a combination of existing cash on hand and debt financing. Barclays, Goldman Sachs and Bank of America Merrill Lynch are providing $49 billion of financing commitments. On completion, Aetna will operate as a stand-alone business unit within the CVS and will be led by members of their current management team. Either of CVS and Aetna may be required to pay a fee of $2.1 billion in the event of termination of the transaction under certain circumstances.

Three of Aetna's Directors, including Aetna's Chairman and Chief Executive Officer, Mark T. Bertolini, will be added to the CVS Board of Directors. Jon Roberts will continue to serve as Executive Vice President and Chief Operating Officer for CVS Health; Karen S. Lynch, currently President of Aetna, will serve as Executive Vice President of CVS Health and President for the Aetna business unit; Fran S. Soistman will continue to serve in the current position of Executive Vice President and Head of Government Services for Aetna; Richard di Benedetto will continue to serve in his current position of President of Aetna International; Shawn M. Guertin, currently Executive Vice President, Chief Financial Officer and Chief Enterprise Risk Officer for Aetna, will assume the position of Executive Vice President and Chief Financial Officer for CVS Health; Thomas M. Moriarty will continue to serve as Executive Vice President, Chief Policy and External Affairs Officer and General Counsel for CVS Health; Troyen A. Brennan, M.D., M.P.H. will continue to serve as Executive Vice President and Chief Medical Officer for CVS Health; Rick M. Jelinek, currently Executive Vice President, Head of Enterprise Strategy for Aetna, will be appointed Executive Vice President, CVS Health; Lisa Bisaccia will continue to serve as Executive Vice President and Chief Human Resources Officer; Also as part of the transition of the organizations, several executives from both CVS Health and Aetna will be departing. David Denton, who currently serves as CVS Health's Chief Financial Officer has elected to depart the company at the close. Similarly, Aetna executives Steven B. Kelmar, Executive Vice President, Corporate Affairs; Thomas J. Sabatino, Jr., Executive Vice President and General Counsel; and Thomas W. Weidenkopf, Executive Vice President and Chief Human Resources Officer, will remain in their roles until the close of the transaction. To assist with the transition following the close, Aetna executives Harold L. Paz, Executive Vice President and Chief Medical Officer, and Meg McCarthy, Executive Vice President, Operations and Technology, will remain with the organization for a period of time.

The transaction is subject to approval by shareholders of CVS and Aetna, regulatory approvals including approvals from certain state departments of insurance and similar regulators, anti-trust approval, approval for listing of new shares on stock exchange, registration statement effectiveness and other customary closing conditions. The transaction is not contingent upon receipt of financing. The transaction was unanimously approved by the Boards of both, CVS and Aetna. As of February 5, 2018, Aetna's Board unanimously recommends its shareholders to vote for the transaction. As of February 9, 2018, the registration statement was declared effective. As of March 13, 2018, Aetna and CVS Health Corporation shareholders approved the merger. As of August 8, 2018, the transaction has received approval from a substantial number of states and more are expected to approve in the summer. On October 10, the Department of Justice approved the transaction after the companies agreed to spin off Aetna's Medicare Part D prescription drug plan business. On October 17, 2018, Connecticut Insurance Commissioner Katharine Wade approved the transaction contingent on the companies' divesting Medicare prescription drug businesses. As of November 15, 2018, the transaction was approved by California Department of Managed Health Care. As of November 26, 2018, Regulators in New York approves the transaction. As on June 22, 2018, the transaction is expected to be complete later in 2018. The transaction is expected to close in the late third quarter of 2018 or the early part of fourth quarter of 2018. As of November 1, 2018, CVS expects to close transaction in the first quarter of 2019. As of November 6, 2018, the transaction is expected to close prior to Thanksgiving. As of November 20, 2018, the transaction is expected to close after Thanksgiving. As of November 26, 2018, the transaction is expected to close on or about November 28, 2018. The transaction is expected to be accretive to earnings per share in the second full year after the close of the transaction.

Morgan Bale, Heather Viets, Faiza Rahman, Michael Lubowitz, Annemargaret Connolly, Joseph Verdesca, Randi Singer, Eric Hochstadt, John Mastando, John O'Loughlin, Adam Safwat, Steven LePorin, Nick Nikic, Daniel Evens, Joshua Van Kirk, Hayden Guthrie, Gabriel, Timothy Welch, Elisabeth Sperle, Carl Duffield, Lauren Jacobson, Nigar Shaikh and Liam Murphy of Weil, Gotshal & Manges LLP advised Barclays, Goldman Sachs and Bank of America Merrill Lynch in the financing. Barclays Capital Inc., and Goldman Sachs & Co. LLC acted as financial advisors to CVS for which they will be paid an advisory fee of $52 million, $5 million of which became payable upon execution of the merger agreement, and the remainder of which is contingent upon completion of the merger. Centerview acted as financial advisor to the CVS Board of Directors for which it will be paid a fee of $12 million. Gus Atiyah, Ryan Thomas Bray, Katherine M.Brennan, Rupa Rao Briggs, Kaitlin Bruno, Katie Allison Butler, Laurence E.Crouch, Jai Garg, Stephen T.Giove, Alan S.Goudiss, Eric M.Grosshandler, Ethan D.Harris, Gina Lee, Doreen E.Lilienfeld, Daniel Litowitz, Lonappen S.Nallengara, Kotoe Oshima, David J.Selesnick, Christopher E.Tomlinson, Matthew Allen Weston, Magnus Bengt Gunnar Wieslander, Cody L.Wright, Daniel Yao, Creighton O' M. Condon, Robert M. Katz and Daniel Litowitz of Shearman & Sterling served as legal advisors to CVS. Dechert and McDermott Will & Emery also acted as legal advisors to CVS. Allen & Company acted as financial advisor to Aetna and will receive a fee of $50 million of which $5 million was payable upon delivery of opinion by Allen & Company and $45 million is contingent upon completion of the merger. Evercore acted as financial advisor to Aetna's Board of Directors. H. Oliver Smith, John A. Bick and Harold Birnbaum of Davis Polk & Wardwell acted as legal advisors for Aetna. Alan Klein of Simpson Thacher & Bartlett LLP acted as legal advisor for Board of Directors of Aetna. Lazard Frères & Co. acted as a financial advisor to Aetna in the transaction for which it was paid an advisory fee of $50 million of which $5 million was payable upon delivery of Lazard's opinion and $45 million is contingent upon completion of the merger. Okapi Partners LLC acted as a proxy solicitor for CVS for which it will be paid a fee of $20,000. Georgeson Inc. acted as a proxy solicitor for Aetna in the transaction and will be paid a fee of $35,000. Wells Fargo Shareowner Services acted as a transfer agent for CVS. Jonathan Davis and Carlo Zenkner of Kirkland & Ellis LLP acted as legal advisors to CVS Health Corporation. Sullivan & Cromwell LLP advised Barclays and Goldman Sachs as financial advisors to CVS Health.

CVS Health Corporation (NYSE:CVS) completed the acquisition of Aetna Inc. (NYSE:AET) on November 28, 2018. CVS Health funded the cash portion of the acquisition through existing cash on hand and debt financing including an aggregate of $40 billion of unsecured senior notes and a $5 billion unsecured term loan. The combined company's shares are listed on the New York Stock Exchange under the ticker symbol "CVS." Going forward, Aetna will operate as a stand-alone business within the CVS Health enterprise and will be led by members of its current management team. As of September 4, 2019, federal judge Richard Leon of U.S. District Court for the District of Columbia granted the motion to approve the consent agreement.