8-KOther EventsExhibits & Filings

CENTENE CORP 8-K Report, Corporate Update (May 4, 2018)

Filed May 4, 2018For Securities:CNC

Summary

Centene Corporation (CNC) announced on May 4, 2018, the successful closing of a public offering of its common stock. The offering involved the sale of approximately 26.6 million shares, including over-allotment shares, raising substantial gross proceeds of approximately $2.8 billion. These proceeds are earmarked to partially fund the acquisition of substantially all the assets of New York State Catholic Health Plan, Inc., d/b/a Fidelis Care New York. This strategic move underscores Centene's commitment to expanding its market presence and scale through significant M&A activity. The underwriting agreement, dated May 1, 2018, was with a syndicate of reputable underwriters including Barclays Capital Inc., Citigroup Global Markets Inc., Wells Fargo Securities, LLC, and Evercore Group L.L.C. The net proceeds of $2.8 billion will be crucial for financing the cash consideration of the Fidelis Acquisition, with the company outlining various potential sources for the remaining balance, such as additional indebtedness, cash on hand, or drawing on its bridge loan facility. This offering represents a significant capital raise to support Centene's growth strategy.

Key Highlights

  • 1Centene Corporation closed a public offering of common stock on May 4, 2018.
  • 2The offering involved approximately 26.6 million shares of common stock.
  • 3The offering is expected to generate approximately $2.8 billion in net proceeds.
  • 4Proceeds will be used to partially finance the acquisition of Fidelis Care New York.
  • 5The underwriting agreement was with a group of prominent investment banks.
  • 6The offering was made under a registration statement filed with the SEC.
  • 7Centene is pursuing a significant acquisition to expand its business.

Frequently Asked Questions

The primary purpose of the stock offering was to raise capital to partially finance the cash consideration required for Centene's previously announced acquisition of substantially all the assets of New York State Catholic Health Plan, Inc., d/b/a Fidelis Care New York (Fidelis Acquisition).

Centene raised approximately $2.8 billion in net proceeds from the sale of approximately 26.6 million shares of its common stock.

The underwriters for this offering, acting as representatives of the several underwriters, were Barclays Capital Inc., Citigroup Global Markets Inc., Wells Fargo Securities, LLC, and Evercore Group L.L.C.

Centene has indicated that the remaining financing for the Fidelis Acquisition could come from various sources, including incurring additional indebtedness (such as credit facilities, loans, or senior notes), using cash on hand, or drawing funds under its senior unsecured bridge loan facility.