Major CVS shareholder plans activist push, will meet with management, sources say

Glenview Capital, a major CVS Health shareholder, is expected to meet with company leadership on Monday to lay out proposed fixes for the struggling business, according to people familiar with the matter, a potential precursor to an activist push.

The hedge fund has established a sizable position in the company, said some of the people. Glenview invests in a variety of sectors, but its most recent regulatory filings show it holds positions in Centene, CVS and Teva Pharmaceuticals among other names.

Specifics about Glenview's proposals could not be learned. The Wall Street Journal first reported that Glenview would be meeting with CVS management, including CEO Karen Lynch.

A CVS spokesperson said the company "maintains a regular dialogue with the investment community as part of our robust shareholder and analyst engagement program."

"Beyond that, we cannot comment on engagement with specific firms or individuals," the spokesperson said."

CVS shares are down 22% year-to-date. The meeting with Glenview is not CVS' first brush with an activist. Earlier this year, Sachem Head Capital Management, the well-known activist fund run by Scott Ferguson, disclosed via regulatory filings that it had amassed a position in the company.

Jeff Smith's Starboard Value also built a stake in the company in 2019, and engaged in discussion with the company's leadership as well.

Investor confidence in CVS has soured after three straight quarters of full-year guidance cuts.

The company's bottom line is getting battered by higher medical costs in its insurance segment – an issue dogging the broader health-care industry as more seniors undergo procedures they had delayed during the Covid-19 pandemic.

CVS owns Aetna, the nation's third-largest health