PacifiCare Health Systems Shareholders Approve Acquisition by UnitedHealth Group

A proposed acquisition of PacifiCare Health Systems by UnitedHealth Group on Thursday "cleared a major hurdle" after PacifiCare shareholders approved the agreement, the Los Angeles Times reports. More than 99% of the 80% of PacifiCare shareholders who participated voted in favor of the acquisition (Vrana/Lifsher, Los Angeles Times, 11/18). Under the agreement, announced on July 6, UnitedHealth would acquire PacifiCare for $9.2 billion in cash, stock and assumed debt. The agreement also would include $230 million in accelerated stock options and payments to PacifiCare executives and an additional $85 million in signing bonuses to executives who remain employed with the company after the acquisition (Kaiser Daily Health Policy Report, 10/18). The California Public Employees' Retirement System, which holds shares of PacifiCare and opposes the proposed payments to executives, voted against the acquisition. PacifiCare would not allow shareholders to vote separately on the proposed payments to executives. The acquisition requires approval from the Federal Trade Commission and regulators in states in which PacifiCare operates. Oregon and Arizona regulators have approved the acquisition, but the agreement remains under consideration by regulators in eight other states. PacifiCare officials expect the acquisition to close by early 2006 (Los Angeles Times, 11/18).