Centene Announces Definitive Agreements to Expand in South Carolina and Exit New Jersey
ST. LOUIS--(BUSINESS WIRE)-- Centene Corporation (NYSE: CNC) announced today that it has simultaneously executed definitive agreements to acquire certain assets of AMERIGROUP Community Care of South Carolina, a wholly-owned subsidiary of AMERIGROUP Corporation, and to sell to AMERIGROUP certain assets of University Health Plans, Inc., a wholly-owned subsidiary of Centene. As of September 30, 2008, University Health Plans and AMERIGROUP Community Care of South Carolina had approximately 55,000 and 9,000 members, respectively. Both transactions, which are subject to the approval of regulators in their respective states, are expected to be completed during the first quarter of 2009.
Michael F. Neidorff, Chairman and Chief Executive Officer of Centene Corporation, stated, "This strategic redeployment of assets is consistent with our portfolio approach to managing our business. It will further enhance the positioning of our subsidiary, Total Carolina Care, by strengthening our platform for future organic growth throughout South Carolina. Our disciplined market share strategy for New Jersey was not being realized at the level of operational and financial efficiency necessary at this time to further cultivate this as a long-term market investment." Mr. Neidorff also added, "We are fortunate to be able to work with AMERIGROUP on these mutually beneficial transactions in order to strengthen our respective strategic positions while continuing to ensure that access to quality healthcare is provided to our members in New Jersey and South Carolina."
The financial impact of both transactions will be discussed during Centene's 2009 financial guidance conference call on December 19, 2008.
About Centene Corporation
Centene Corporation is a leading multi-line healthcare enterprise that provides programs and related services to individuals receiving benefits under Medicaid, including the State Children's Health Insurance Program (SCHIP), as well as Foster Care, Aged, Blind, Disabled (ABD), Long-Term Care and Medicare (Special Needs Plans). The Company operates local health plans and offers a range of healthcare solutions for the rising number of uninsured Americans. It also contracts with other healthcare and commercial organizations to provide specialty services including behavioral health, life and health management, managed vision, nurse triage, pharmacy benefits management and treatment compliance. Information regarding Centene is available via the Internet at www.centene.com.
The information provided in this press release contains forward-looking statements that relate to future events and future financial performance of Centene. Subsequent events and developments may cause the Company's estimates to change. The Company disclaims any obligation to update this forward-looking financial information in the future. Readers are cautioned that matters subject to forward-looking statements involve known and unknown risks and uncertainties, including economic, regulatory, competitive and other factors that may cause Centene's or its industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Actual results may differ from projections or estimates due to a variety of important factors, including Centene's ability to accurately predict and effectively manage health benefits and other operating expenses, competition, changes in healthcare practices, changes in federal or state laws or regulations, inflation, provider contract changes, new technologies, reduction in provider payments by governmental payors, major epidemics, disasters and numerous other factors affecting the delivery and cost of healthcare. The expiration, cancellation or suspension of Centene's Medicaid Managed Care contracts by state governments would also negatively affect Centene.
Source: Centene Corporation
Released November 20, 2008