April 25 (Reuters) - UnitedHealth Group has agreed
to sell Change Healthcare's claims editing business for
$2.2 billion in a move some analysts say could ease regulatory
hurdles in the way of an $8 billion merger between the
healthcare companies.
Earlier this year, the U.S. Department of Justice (DoJ) sued
to stop the acquisition for giving UnitedHealth access to
competitors' data, forcing the companies to extend the deal's
closing date by nine months to Dec. 31.
The sale of the claims business, to private equity firm TPG
Capital, will only go through once UnitedHealth's acquisition of
Change is complete, Change said in a regulatory filing. https://www.sec.gov/ix?doc=/Archives/edgar/data/1756497/000119312522116452/d574197d8k.htm
UnitedHealth and Change offer competing softwares for
processing healthcare claims and together serve 38 of the top 40
health insurers in the country, the DoJ said in its complaint in
February.
Owning Change's claims business, ClaimsXten, would offer
UnitedHealth a window into rival health plans at Humana Inc
, Anthem Inc <ANTM.N, CVS Health Corp's Aetna and
Cigna Corp, the agency said.
Citi analyst Daniel Grosslight said the sale of the claims
business will likely remove the DoJ's argument against the
merger, and potentially increase the probability of the deal
going through.
"We do not think this will reduce the value of Change to
UnitedHealth as there is significant overlap between ClaimsXten
and Optum's PI solution," Grosslight wrote in a note.
Optum is UnitedHealth's health services unit which will
absorb Change if the acquisition is completed.
UnitedHealth, which has said it would fight the lawsuit, did
not have any further comments on the deal beyond the regulatory
filing.
Shares of Change Healthcare were up 1.03% at $23.8, while
UnitedHealth fell about 1% to $515.70.
"It looks like the market is betting that this transaction
could grease the wheels of getting the deal done, considering
the Change share movement today in a down market," Morningstar
analyst Julie Utterback told Reuters.
(Reporting by Mrinalika Roy in Bengaluru; Editing by Devika
Syamnath)