This excerpt taken from the CVS 10-K filed Feb 27, 2007.
We may be unable to successfully integrate Caremarks operations or to realize the anticipated cost savings and other benefits of the merger. As a result, the value of our common stock may be adversely affected.
We entered into a merger agreement because we believe that the merger will be beneficial to us and our stockholders. Currently, Caremark operates as an independent public company. Achieving the anticipated benefits of the merger will depend in part upon whether we can integrate Caremarks business in an efficient and effective manner. We may not be able to accomplish this integration process smoothly or successfully. The necessity of coordinating geographically separated organizations, systems and facilities and addressing possible differences in business backgrounds, corporate cultures and management philosophies may increase the difficulties of integration. We and Caremark operate numerous systems, including those involving management information, purchasing, accounting and finance, sales, billing, employee benefits, payroll and regulatory compliance. The integration of certain operations following the merger will require the dedication of significant management resources, which may temporarily distract managements attention from our day-to-day business. Employee uncertainty and lack of focus during the integration process may also disrupt our business. Any inability of management to integrate successfully the operations of Caremark could have a material adverse effect on our business and results of operations. We may not be able to achieve the anticipated operating and cost synergies or long-term strategic benefits of the merger. An inability to realize the full extent of, or any of, the anticipated benefits of the merger, as well as any delays encountered in the integration process, could have an adverse effect on our business and results of operations, which may affect the value of the shares of our common stock after the completion of the merger.
Our success after the merger will depend in part upon our ability to retain key employees. Competition for qualified personnel can be very intense. In addition, key employees may depart because of issues relating to the uncertainty or difficulty of integration or a desire not to remain with the combined company. Accordingly, no assurance can be given that we will be able to retain key employees.
Certain legal restrictions have limited our ability to complete and finalize an integration plan relating to the merger of the two companies. The actual integration may result in additional and unforeseen expenses, and the anticipated benefits of the integration plan may not be realized.