(Bloomberg) -- Aetna Inc., the second-largest U.S. healthinsurer by market value, is closing in on an acquisition of HumanaInc. and could reach a deal as early as this weekend, severalpeople with knowledge of the matter said.

Humana shares rose 8 percent to $198.99 at 1:47 p.m. in NewYork, the biggest intraday gain since May 29. Aetna shares rose 2.8percent to $131.07.

Read: Aging Baby Boomers make carriersattractive

Discussions between the two companies have intensified duringrecent days, after it emerged over the weekend that rivals AnthemInc. and Cigna Corp. had held merger talks of their own, said thepeople, who asked not to be identified discussing privateinformation.

Read: Cigna rejects Anthem's takeoverbid

Aetna made a formal bid this week in the form of cash and stock,the people said. While the exact offer details weren’t available,any proposal would probably value Humana above its $28 billionmarket capitalization as of Wednesday’s close.

Humana has received two offers, one from Aetna and another fromCigna, said another person. The Humana board prefers the offer fromAetna, the person said.

A representative for Humana didn’t respond to requests forcomment. Representatives for Aetna and Cigna declined tocomment.

Should Humana agree to sell itself to Cigna, it would run therisk of Cigna’s shareholders voting down a deal to try and persuadethe company to sell itself to Anthem, which last weekend said ithad offered to pay $184 a share for Cigna.

No agreement between Humana and Aetna has been reached, thepeople cautioned, adding that Humana could still agree to adifferent transaction, such as selling itself to Anthem, which hasalso previously expressed interest, or Cigna, the person said.

UnitedHealth Group Inc., the largest U.S. health insurer, couldalso make a bid for Aetna, complicating the situation even further.The U.S. health insurance sector is undergoing a period of intensedeal activity, with the five largest insurers based on market valueall working either to sell themselves or buy a rival.

Humana’s 3.2 million Medicare Advantage members have made it atarget, as more Americans turn 65 and become eligible for thehealth program for the elderly and its private insurer-runversion.

“Medicare Advantage is a coveted space,” Michael Bernstein, apartner at Baird Capital’s U.S. private equity team who focuses onhealth care, said in an interview. “To develop a similar scale inMedicare would take a great deal of work and time, which would bebypassed by making that transaction happen.”

Medicare Advantage membership is expected to rise to 68.4million in 2023, up 26 percent from this year, according to theCenters for Medicare & Medicaid Services. Humana, based inLouisville, Kentucky, insures more than 14 million people throughcommercial, Medicare and Medicaid plans.

Some of the consolidation talk has been fueled by the PatientProtection and Affordable Care Act. Known as Obamacare, the 2010law overhauled the U.S. health-care system with new rules thatforce insurers to look for efficiencies. The law also providedsubsidies to help people afford insurance, creating millions of newcustomers that the companies are racing to capture.

Thurdsay’s Supreme Court decision upholding a key piece of thelaw helps remove a potential obstacle. The decision keeps U.S.subsidies flowing to more than 6 million people to help them affordhealth insurance from Aetna, Humana and other health insurers.

--With assistance from Ryan Sachetta in New York.

Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.