Acquisition Advances WellPoint’s Growth Strategy and Enhances Ability to Build Direct-to-Consumer Relationships
INDIANAPOLIS--(BUSINESS WIRE)--Jun. 4, 2012-- WellPoint, Inc. (NYSE: WLP), one of the nation's largest health benefits companies, announced today that it has entered into an agreement to acquire 1-800 CONTACTS, Inc., the largest direct-to-consumer retailer of contact lenses in the U.S. whose model is built on providing a superior customer experience and a wide selection of products at affordable prices. Consumers are able to order contacts and glasses in a simple, fast and hassle-free manner using the technology – web, phone or mobile—that is most convenient for them.
“This acquisition strategically aligns with our efforts to capitalize on new opportunities for growth, and further diversifies the company’s revenue stream into the complementary and higher-margin eyewear business,” said
Angela F. Braly
, chair, president and chief executive officer of WellPoint. “1-800 CONTACTS has rapidly expanded through exceptional brand recognition, convenient customer service and an industry-leading direct-to-consumer model. We believe these assets will drive continued strong future growth in the eyewear marketplace and also significantly enhance our efforts to build trusted relationships with consumers across the entire country.”
1-800 CONTACTS offers consumers a convenient and affordable way to purchase contact lenses through its easy-to-remember, toll-free telephone number, “1-800 CONTACTS” and its www.contacts.com web site. The company also offers frames and lenses through its glasses.com web site.
“We are excited to be a part of not only one of the largest health benefits providers in the country, but also the most customer-focused,” said
, chief executive officer and co-founder of 1-800 CONTACTS. “We look forward to joining WellPoint to serve the eyewear needs of our mutual customers. Our companies share common goals of providing consumers with the highest level of service and making the experience as simple as possible.”
“1-800 CONTACTS serves approximately 3.3 million customers today, yet with more than 38 million people wearing contacts and more than 140 million people wearing glasses in the U.S., there is a significant opportunity to attract new customers as we strive to deliver the best health care value both in the eyewear industry and other health care products,” said Braly.
Financial terms of the transaction were not disclosed. The acquisition is expected to close in the third quarter of 2012, and is subject to standard closing conditions and customary approvals required under the Hart-Scott-Rodino Antitrust Improvements Act. The transaction will be financed from available cash on hand and is expected to be slightly dilutive to earnings per share in 2012 by approximately $0.04 due to transaction and integration costs. WellPoint now expects 2012 net income to be at least $7.80 per share, including $0.19 per share of net investment gains from the first quarter of 2012.
About WellPoint, Inc.
At WellPoint, we believe there is an important connection between our members’ health and well-being—and the value we bring our customers and shareholders. So each day we work to improve the health of our members and their communities. And, we can make a real difference since we have nearly 34 million people in our branded health plans, and more than 62 million people served through our subsidiaries. As an independent licensee of the Blue Cross and Blue Shield Association, WellPoint serves members as the Blue Cross licensee for California; the Blue Cross and Blue Shield licensee for Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri (excluding 30 counties in the Kansas City area), Nevada, New Hampshire, New York (as the Blue Cross Blue Shield licensee in 10 New York City metropolitan and surrounding counties and as the Blue Cross or Blue Cross Blue Shield licensee in selected upstate counties only), Ohio, Virginia (excluding the Northern Virginia suburbs of Washington, D.C.), and Wisconsin. In a majority of these service areas, WellPoint’s plans do business as Anthem Blue Cross, Anthem Blue Cross and Blue Shield, Blue Cross and Blue Shield of Georgia and Empire Blue Cross Blue Shield, or Empire Blue Cross (in the New York service areas). WellPoint also serves customers throughout the country as UniCare and in certain California, Arizona and Nevada markets through our CareMore subsidiary. Additional information about WellPoint is available at www.wellpoint.com