WellPoint to Buy Georgia HMO

WellPoint Health Networks Inc. announced last week announced plans for a $500 million acquisition of the Cerulean Cos. Inc., parent of Blue Cross and Blue Shield of Georgia.

Under terms of the deal, Blue Cross and Blue Shield of Georgia will operate as an Atlanta-based business unit of WellPoint. The transaction is expected to close in the fourth quarter this year, pending approval from regulators and Cerulean shareholders.

Blue Cross and Blue Shield of Georgia recently resolved litigation that had been delaying their conversion from non-profit to for-profit status. As part of the settlement, the companies will establish an $80 million Georgia-based independent charitable foundation, which will receive cash and WellPoint common stock.

Woodland Hills-based WellPoint is the parent of Blue Cross of California. Cerulean Cos. has 1.7 million members in Georgia.

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