Insurer Aetna has inked a deal to purchase its arch rival Coventry Health Care for $5.7bn in cash and stock, paving a way to emerge as a major player of government-financed health care segment.

Upon completion of the acquisition of Coventry, Aetna’s revenue will grow from its government business to more than 30%, which is 23% at present, The Wall Street Journal reported.

Connecticut-based Aetna is paying $42.08 a share for Coventry, which is a 20.4% premium to Coventry’s shares as of 17 August 2012, closing price.

The international daily newspaper reported citing the sources familiar with the matter that the deal is a mix of 65% cash and 35% stock.

Aetna believes that the acquisition would add about 45 cents per share to its 2014 earnings and expects to increase its 2015 earnings by 90 cents per share.

As per the terms of the deal, Coventry stockholders will receive $42.08 a share, in a mixture of cash and 0.3885 share of Aetna for each Coventry share.

The deal which includes debt assumption has been valued at $7.3bn, placing it one of this year’s largest transactions to date.