November 5, 2024

By Jonathan Stempel

(Reuters) – Federal prosecutors charged a Pennsylvania man on Thursday with insider buying and selling for utilizing ideas from his home associate to commerce illegally forward of CVS Well being (NYSE:)’s $9.5 billion buy final yr of major care supplier Oak Road Well being.

Carlos Sacanell, 58, of Willow Grove, was additionally charged with mendacity to the FBI by denying having obtained the information earlier than the takeover was introduced in February 2023. The U.S. Securities and Alternate Fee filed a associated civil case towards Sacanell.

A lawyer for Sacanell didn’t instantly reply to requests for remark. The workplace of U.S. Legal professional Jacqueline Romero in Philadelphia mentioned Sacanell was arrested on Thursday at his dwelling.

Authorities mentioned Sacanell generated $617,000 buying and selling in Oak Road inventory and choices after his associate, a senior Oak Road government, shared materials private details about the deliberate takeover.

The SEC mentioned the buying and selling started two days after Sacanell’s associate, who had discovered a takeover is perhaps within the offing, lamented in a textual content message that it was “very uncomfortable having info I am unable to share.”

Sacanell texted again that his associate ought to inform inquiring co-workers you do not know what is going on on, the SEC mentioned.

The associate was not charged.

© Reuters. FILE PHOTO: A general view shows a sign of CVS Health Retail Pharmacy Customer Care Center, at CVS headquarters of CVS Health Corp in Woonsocket, Rhode Island, U.S. October 30, 2023. REUTERS/Faith Ninivaggi/File Photo

CVS, the pharmacy chain and pharmacy advantages supervisor, agreed to purchase Oak Road for $39 per share, 50% above the place the inventory traded shortly earlier than information of the takeover grew to become public, the SEC mentioned.

Oak Road’s share worth rose 36% over the subsequent two days, together with after CVS introduced the takeover. CVS valued the transaction at $10.6 billion together with debt.