Published - August 22, 2022 @ 5:42 PM (EET)

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Shares of Signify Health Inc. (NYSE:SGFY) soared in premarket trading Monday following reports by the Wall Street Journal that Amazon (NASDAQ:AMZN), UnitedHealth Group Inc. CVS Health Corp., and Option Care Health Inc. are competing to acquire the home-health technology and services provider.

So far, UnitedHealth has tabled the highest bid of over $30 per share for Signify, with Amazon's offer price the second highest, according to the report.  Signify is expected to meet Monday to discuss the takeover bids for the company.

While Signify Health's market capitalization is nearly $5 billion, The Journal reported it was for sale in an auction that could value it at more than $8 billion.  Interestingly, the company started trading on the stock exchange in February 2021.

Bids are expected around Labor Day (5 September), but there's usually a chance a longing bidder could agree to a deal earlier.

WHY IT MATTERS

As Amazon expands its footprint in the healthcare market, the buyout of Signify Health could give the e-commerce behemoth a healthy boost. 

Moreover, should Amazon end up winning the auction, it would mark the second consecutive loss for CVS Health to Amazon when it was interested in acquiring 1LifeHealthcare before Amazon agreed to a $3.9 billion deal for the primary-care practice business under the name One Medical.

The deal marks the first major acquisition announced during Chief Executive Andy Jassy's tenure, for whom expansion into healthcare is a top priority.

However, acquiring Signify Health wouldn't come without complications since acquisitions by Amazon tend to get a hard look from US regulators, and with Amazon's purchase of One Medical, concerns about competition in technology and health care are increasing.

Shares of Signify rose 41% to $29.81 after closing at $21.20 Friday.  Representatives of the companies were not available for comment on the matter.