COLORADO BLUES: WellPoint Seeks to Trump Anthem’s Bid
The Rocky Mountain News reports that WellPoint Health Networks is moving to increase its bid for Blue Cross Blue Shield of Colorado, hoping to break the preliminary deal the Blues signed with Indiana-based Anthem Inc. earlier this week. The Rocky Mountain News reports that WellPoint may "up the ante to $240 million as early as today," exceeding both its initial $200 million bid and Anthem's $165 million offer. WellPoint spokesperson Peter O'Neill said, "We said 'in excess of $200 million' in our offer letter. We're estimating $200 million to $240 million based on our initial due diligence."
Colorado law stipulates that the fair market value of any not-for-profit company must be set aside for charity purposes in the event of purchase by a for-profit. Wellpoint's offer would infuse the Colorado Blues with $60 million up front and place the remainder, some $150 million, in a charitable foundation -- more than offered by the Anthem bid. Of Anthem's $165 million offer, about $140 million would go to a foundation. Blues spokesperson Neil Westergaard said that although "it would cost Blue Cross to break the Anthem deal, the insurer's board will still consider WellPoint's offer." Investment banker Jack Green, whose firm is handling the deal, said "WellPoint was Blue Cross' first choice among three suitors," but "WellPoint backed away from its original offer" (Conklin, 4/2).