WellPoint Selling SubsidiariesPosted: Updated:
Indianapolis-based WellPoint Inc. (NYSE:WLP) is selling its 1-800-CONTACTS and glasses.com subsidiaries. WellPoint Chief Executive Officer Joe Swedish says the deals will allow the company to focus on its commercial and government business segments as health care reform continues.
January 7, 2014
Indianapolis, Ind. -- WellPoint (NYSE: WLP) today announced it has signed a definitive agreement to sell its online contact lens retail subsidiary 1-800 CONTACTS to private equity firm Thomas H. Lee Partners. Additionally, the company has entered into an asset-purchase agreement for glasses.com and its virtual try-on technology with Luxottica, a leader in the design, manufacture, distribution and sale of fashion, luxury and sports eyewear. Each agreement is subject to customary closing conditions and each transaction is expected to close in the first quarter of 2014.
"1-800 CONTACTS has strong brand recognition and a leading direct-to-consumer model. However, as we prepare for the coming changes to the health care system, we are focused on our core growth opportunities across both our commercial and government business segments. Proceeds from this transaction will support our continued capital deployment strategies," said Joseph R. Swedish, chief executive officer of WellPoint.
Financial terms of the transaction were not disclosed. In connection with the sale agreements, WellPoint expects to record an impairment charge in the range of $0.52 to $0.57 per share in the fourth quarter of 2013. As a result, WellPoint now expects GAAP net income of at least $7.88 per share for the full year 2013. Excluding the charge, WellPoint continues to expect adjusted net income of at least $8.40 per share for the full year 2013. This guidance includes no investment gains or losses beyond those recorded during the first nine months of 2013.
Source: WellPoint Inc.