Shares of Change Healthcare fell nearly 10 percent after hours Tuesday after a report said the U.S. Department of Justice is considering filing suit to halt the acquisition of the Nashville-based company by UnitedHealth Group.
The Information reported Tuesday afternoon that DOJ officials have recently reached out to private attorneys about their interest in leading a lawsuit against the United-Change deal, which was announced in January and would be worth about $8 billion if consummated.
The news isn’t coming out of nowhere: Justice officials in late March asked for more information about the deal and a number of national trade groups said they were concerned about the competitive aspects of the proposed transaction. More broadly, the administration of Joe Biden has been aggressive on the antitrust front: In June, it sued to block the proposed $30 billion purchase of insurance broker Willis Towers Watson by industry giant Aon.
Shares of Change (Ticker: CHNG) closed Tuesday’s session at $21.97 but fell about 9 percent to nearly $20 after hours. United’s plan calls for the company to pay $25.75 in cash for each Change share.
In their sale agreement signed early this year, United and Change executives included a clause giving United the option to call off the deal if regulators were to require the sale of businesses with more than $650 million in annual revenues.
Change Healthcare CEO Neil de Crescenzo and his team are scheduled to report their first-quarter financial results Wednesday afternoon.