CVS Health is closing in on a deal to acquire primary care provider Oak Street Health for $10.5 billion. The news was first reported by The Wall Street Journal, which cited people with knowledge of the matter.

News of the acquisition was leaked last month when the two companies were reportedly engaging in talks. Now, CVS Health and Oak Street Health are circling a deal for a share price of $39. The deal could be announced by the companies as soon as this week if it is finalized. 

The deal is just the latest mega-deal from CVS Health. The retail pharmacy chain announced it will acquire Signify Health for $8 billion last year. Signify Health is a home health services company, while Oak Street Health is a primary care provider for Medicare beneficiaries. Both deals push CVS Health further into the healthcare provider space. The company also owns insurer Aetna, which it acquired in 2018 in the biggest healthcare deal in U.S. history.

According to the WSJ, CVS’ strategy of becoming a provider aligns with healthcare trends. CVS has positioned itself as a provider of some healthcare services for many years through its HealthHUB and Minute Clinic offerings, but through acquisitions the company can take on a much larger patient population with many more services. 

“Companies with health-insurance units, particularly those that offer Medicare Advantage plans, the private version of the federal program, have been especially interested in acquiring the clinics,” the WSJ reported. “The combinations would help the companies shave costs by managing patients more closely and in particular, helping them avoid costly hospital visits.”

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