Publicly-traded health insurer Centene announced late Tuesday that it would buy privately-held Fidelis Care for $3.75 billion.
The deal allows Centene to enter New York State, the second largest managed care state (by membership) in the U.S., and expand its government-sponsored healthcare coverage. Fidelis Care serves more than 1.6 million members and totaled $4.8 billion in revenue for the first six months of 2017. Together, the companies serve almost 14 million people.
The acquisition also gives Centene a leading position in America's four largest managed care states by membership: California, Florida, New York, and Texas.
"Centene's and Fidelis Care's missions are fully aligned in terms of promoting health through high quality, accessible care and services for all and advocating for health policy that accords true dignity and respect for all people, especially the underserved," Centene's president and CEO, Michael F. Neidorff, said in a statement.
Centene stock was up almost 7% to $97 in aftermarket trading. The move is expected to improve the company's earnings per share, it said, and will close in the first quarter of 2018.