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WellCare Reaches Preliminary Settlement in Securities Class Action

TampaBay, FL: WellCare Health Plans Inc. has signed an agreement finalizing the terms of a $200 million settlement in a securities class action lawsuit.

The settlement, which still requires court approval, is intended to resolve all the claims that are the subject of the class action, WellCare said in a filing with the Securities and Exchange Commission.

The case stemmed from allegations of health care fraud. The material terms of the agreement are substantively the same as WellCare disclosed in August, the filing said. The company said it would make a cash payment of $52.5 million within 30 days after the court approves the settlement and another $35 million by July 31, 2011. WellCare also said it would issue tradeable unsecured bonds with an aggregate face value of $112.5 million, a fixed coupon of 6 percent and a maturity date of Dec. 31, 2016.

WellCare, headquartered in Tampa, provides managed care services targeted to government-sponsored health care programs.

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Last updated on Dec-27-10