Anthem buys Trigon for $4 billion

The trend toward Blues consolidations takes another giant step as the two plans merge.

By Myrle Croasdale, AMNews staff. May 13, 2002.

Anthem Inc. is expanding into the Southeast with its pending purchase of Richmond, Va.-based Trigon Healthcare Inc.

The two companies, both owners of Blue Cross Blue Shield plans, on April 29 announced the pending $4 billion cash and stock deal. Stock analysts are saying that the deal establishes Indianapolis-based Anthem alongside Thousand Oaks, Calif.-based WellPoint Health Systems as the companies that will likely dominate Blues ownership as plans consolidate.

Trigon's shareholders will receive $30.00 in cash and 1.062 shares of Anthem stock per Trigon share. The merger is expected to close in three to six months.

The deal will extend Anthem's range into Virginia, where Trigon is the largest managed health care company with 2.2 million members and 35% market share.

Anthem is already ranked as the fifth largest publicly traded health benefits company in the United States.

Larry Glasscock, president and chief executive officer for Anthem, said in a prepared statement, "The merger unites two excellent organizations and extends Anthem's presence into a very important new Southeast region."

Consolidation has been heralded by managed care companies as the solution to keeping administrative costs down and health plans competitive.

Tom Sneed, Trigon's chair and chief executive officer said: "Working together we expect to expand our future opportunities and capture new efficiencies, particularly as investment requirements for new technologies accelerate in the future." [...]