CVS is in exclusive talks to buy Cano Health

CVS Health is in exclusive talks to buy Cano Health, the health-care provider backed by billionaire Barry Sternlicht, according to people familiar with the matter.

CVS is currently conducting due diligence on the Miami, Florida-based company, said the people, who asked to not be identified because the matter isn’t public. There is no certainty a deal will be reached, in part because Humana has a right of first refusal should Cano find a buyer under an agreement they made in 2019, said the people.

Representatives for CVS and Cano declined to comment.

Cano rose 7.3% to $9.48 at 10:07 a.m. in New York trading Friday, giving the company a market value of about $4.6 billion.

Cano operates primary care facilities and supports medical practices that cater to seniors in states including Florida, Texas and Nevada, according to its website.

The company listed on the New York Stock Exchange last year through a merger with a special purpose acquisition company sponsored by Sternlicht, who leads Starwood Capital Group Management.

CVS, a major drugstore operator, has been expanding more directly into health care via acquisitions, agreeing last month to buy Signify Health. Its largest deal in the space was the purchase in 2018 of insurer Aetna in a deal valued at $68 billion, including debt. That transaction followed its 2007 acquisition of Caremark RX for about $27 billion.

CVS has said it wants to make health care more convenient, personalized and affordable for consumers and last year said it planned to partner with doctors or potentially acquire primary care practices.