UnitedHealth, Amedisys Stocks In Focus As $3.3B Merger Deadline Extended Amid DOJ Wrangling: Retail Guarded

The merger announced in Jun. 2023 involved UnitedHealth’s Optum unit buying Amedysis for $100 per share in cash, a 26% premium over the latter’s then-prevailing stock price.

Healthcare behemoth UnitedHealth Group Inc. ($UNH) and home health and hospice care provider Amedisys Inc. ($AMED) have opted to extend their merger deadline date to the end of 2025 as the Department of Justice (DOJ) stiffly opposes the consummation.

The merger announced in Jun. 2023 involved UnitedHealth’s Optum unit buying Amedysis for $100 per share in cash, a 26% premium over the latter’s then-prevailing stock price.

The acquisition plan ran into trouble after the DOJ and the Attorneys General of New York, New Jersey, Maryland, and Illinois filed an antitrust civil lawsuit against UnitedHealth’s $3.3 billion acquisition of Amedysis. The lawsuit is being heard by the U.S. District Court for the District of Maryland.

The antitrust charges came despite UnitedHealth proposing to divest certain facilities to VitalCaring Group. 

In a late Thursday filing with the SEC, UnitedHealth and Amedysis said they entered into an agreement, which waived off each other's right to terminate the merger because of the inability to complete the deal by the agreed-upon deadline. 

The companies previously announced the deal would be completed by earlier of the tenth business day following a final order of the DOJ lawsuit or by 11:59 p.m. EST on Dec. 31, 2024.

The deadline has now been extended to Dec. 31, 2025. 

The extension gives the deal a chance to go through, as a new regime under President-elect Donald Trump is set to take over. 

That said, Trump has picked Gail Slater to head the DOJ's antitrust division. While announcing the nomination on Truth Social, the President-elect said Slater would continue the crackdown on big techs.

The news of the deal deadline extension pushed Amedysis shares higher by 4.70% to $89.99 in premarket trading as of 9:20 a.m. ET. UnitedHealth shares edged down 0.23%

Shares of Amedysis and UnitedHealth are down 9.6% and 1.39%, respectively, this year. 

Sentiment toward UnitedHealth stock held steady at ‘bullish’ on the Stocktwits platform, with message volume remaining ‘low.’

The retail crowd on the platform turned ‘neutral’ toward Amedysis stock (48/100) but message volume surged to ‘extremely high.’

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