Federal prosecutors have charged a man with alleged insider trading related to CVS Health's acquisition of Oak Street Health, according to the U.S. Attorney's Office in Philadelphia.
Carlos Sacanell, 58, of Willow Grove, Pennsylvania, is accused of using confidential information from his domestic partner, a senior executive at Oak Street Health, to profit from trades ahead of the $9.5 billion deal announced in February 2023, prosecutors said in an Oct. 31 statement.
The U.S. Securities and Exchange Commission (SEC) has also launched a parallel civil case against Sacanell.
Authorities said Sacanell generated $617,000 of trading profit in Oak Street stock and options after his partner shared material non-public information about the planned takeover.
"Sacanell allegedly purchased Oak Street stock and call options based on that information, resulting in him owning more Oak Street call options than any other retail investor and the fifth most overall," the SEC said in a press release on Thursday.
Federal authorities arrested Sacanell at his residence on Thursday, as reported by U.S. Attorney Jacqueline Romero's office. In addition to insider trading charges, Sacanell is accused of lying to the FBI by claiming he did not receive tips before the takeover announcement.
If convicted, Sacanell faces a maximum sentence of 25 years in prison.
Zak Goldstein, Sacanell's attorney, said in an email he was disappointed with the indictment, as there had been an "enormous amount" of information on the takeover open to the public. He said he looked forward to settling the case in court.
The CVS Health acquisition of Oak Street Health was valued at $39 per share, representing a 50 percent premium over the stock's trading price shortly before the deal became public knowledge, the SEC said. Following the announcement, Oak Street's share price surged 36 percent over two days.
The SEC didn't immediately return a request for further comment from NTD News, confirming the information.