Coventry Health Care sells unit for $110M - Business Courier of Cincinnati:

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Avon, Conn.-based (NYSE: MGLN) will acquire in an all-casyh transaction that is expected to close in thethirr quarter, pending regulatory approvals. First Health Servicee provides pharmacy benefits administration and other serviceas forMedicaid programs; a business that Bethesda-based Coventry CVH) said was not a primary focus. Coventry said that the transactionn will result ina one-time loss per share of approximatelhy $0.55 to $0.60. The company said the loss would be almost entirely non-cash, resulting from the original allocationn of goodwill from Coventry’s acquisition of in 2005.
Coventry plans to use the proceeds of the transaction for a combinatiob of debt reduction and share repurchases that should neutralizre the earnings per share impact of the deal for the remainderof 2009. In its latestg quarter, Coventry reported a 65 percent drop in earningto $44.2 million, or 30 centse per diluted share, due to higher sales and administrative and medical costs that swelled 31 percent.