(Bloomberg) -- Centene Corp. agreed to buy Health Net Inc. forabout $6.3 billion in cash and stock, creating a combination of twosmaller U.S. health insurers ahead of an expected round of mergersamong the industry’s giants.

Health Net investors will get 0.622 shares of Centene and $28.25in cash for each share they hold, the companies said in a statementon Thursday. The implied price of $78.57 a share is 21 percent morethan Health Net’s closing stock price Wednesday.

The deal gives Centene the biggest market share amongprivate administrators of Medicaid, the federally funded health program for thepoor -- a bet that the U.S. government will keep playing a largerrole in health care.

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