Amazon is angling to expand its position in the healthcare market.
Amazon has entered the bidding war for Signify Health, a Dallas-based company that is currently entertaining a buyout. Other bidders include CVS Health Corp., Option Care Health Inc., and UnitedHealth Group Inc.
Signify is an analytics and technology company based in Dallas that leverages technology and provider networks to assist with in-home care. It has a market value of $5 billion, but the auction could value it as much as $8 billion, reports The Wall Street Journal.
“UnitedHealth has submitted the highest bid in excess of $30 a share, while Amazon’s offer is close behind, the people said, asking not to be identified as the discussions are private. Signify is holding a board meeting Monday to discuss the bids,” reports Bloomberg.
Signify is expecting final bids by September 6, after Labor Day, but may not finalize or pursue any of the offers, choosing to stay independent.
Why it’s important
Amazon’s bid on Signify could mark a major expansion for the Seattle-based corporation that has tentacles in dozens of other business sectors. The bid reflects Amazon’s attempt to emerge into the healthcare industry, a move that could “open a new front for antitrust regulators,” reports Axios.
Amazon already purchased a primary care company for $4 billion in July and operates its own telehealth therapy program called Amazon Care. Further expansion may draw negative attention from regulators.
“A deal would mark Amazon’s latest foray into the healthcare sector… The online commerce and media and technology giant in July agreed to pay $3.9 billion for 1Life Healthcare Inc., which operates a primary-care practice under the name One Medical,” says The Wall Street Journal.
The Federal Trade Commission may not take the expansion lightly, should Amazon’s bid win in September. According to Protocol, the purchase could worsen relationships between Amazon and the FTC. The One Medical acquisition may not set off alarms, especially if the Signify bid fails, but the FTC already has outstanding hostility towards Amazon’s competitive business practices.
“As Amazon starts to make more deals, FTC leaders may decide there’s more paperwork they want to require, more conduct to examine, and more legal theories to try out,” says Protocol.