CVS Purchase of Oak Street Among Biggest M&A Deals This Year After Slow 2022

The $10.6 billion acquisition is the third major deal announced this year, and CVS Health's second in recent months

Image of CVS store


  • CVS will buy Oak Street Health for an enterprise value of $10.6 billion, one of the largest acquisitions of 2023 so far.
  • At least two other multi-billion-dollar acquisitions have been discussed this year after a slow 2022.
  • Investment banks stand to benefit from a pickup in M&A activity after a turbulent 2022 that led many firms to announce widespread job cuts.

CVS Health Corp. (CVS) will purchase Oak Street Health Inc. (OSH) in a $10.6 billion deal, among the largest acquisitions so far this year following a lackluster 2022.

The drugstore company will pay $39 per share for Oak Street, for an equity value of about $9.5 billion, with the deal expected to close later this year. Oak Street operates a network of clinics and employs hundreds of physicians and nurse practitioners, adding to CVS's new focus on primary care offerings.

This is the second major acquisition for CVS in several months. The company announced in September that it would pay about $8 billion to buy health risk assessment company Signify Health.

M&A Activity Picking Up in 2023

The Signify deal was one of only a few large acquisitions in 2022. Just over a month into 2023, though, M&A activity is accelerating.

CVS' purchase of Oak Street is at least the third multibillion-dollar deal discussed in recent weeks. In January, industrial engineering firm Emerson Electric Co. (EMR) reported it would propose the acquisition of National Instruments Corp. (NATI) for $7.6 billion. Just this week, gold mining company Newmont Corp. (NEM) proposed a $17 billion all-stock buyout of Australian rival Newcrest Mining in what could be the largest deal of the year so far.

New Business for Banks

Investment banks are poised to benefit from revitalized M&A deal flow. Last year, as the pace of transactions slowed, Wall Street firms that had been aggressive in hiring early in the pandemic reversed course and prepared to announce layoffs. Goldman Sachs Group (GS), for instance, said in January it would make its deepest headcount cuts in years.

Market volatility and high interest rates hindered M&A last year, but companies have adopted new strategies allowing them to minimize costs and risks in the process. To the extent that these deals still employ big banks, those financial firms could see a boost in business.

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  2. Bloomberg. "CVS Agrees to Buy Oak Street Health in $10.6 Billion Deal."

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  4. CVS Health Corp. "CVS Health to acquire Signify Health."

  5. Emerson Electric Co. "Emerson Announces Premium, All-Cash Proposal to Acquire National Instruments for $53 Per Share."

  6. The Wall Street Journal. "Newmont Proposes $17 Billion Takeover of Australia's Newcrest Mining."

  7. Bloomberg. "Wall Street Dealmaking Drop Has Bankers Feeling Job-Cut Heat."

  8. Reuters. "Goldman Sachs readies biggest layoffs since the financial crisis."

  9. Wall Street Journal. "M&A Is Expected to Pick Up in 2023 as Companies Adapt to Tougher Conditions."

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