NEW YORK – Centene Corp. agreed to buy Health Net for about $6.3 billion in cash and stock, creating a combination of two smaller U.S. health insurers ahead of an expected round of mergers among the industry's giants.

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

The deal gives Centene the biggest market share among private administrators of Medicaid, the federally funded health program for the poor — a bet that the U.S. government will keep playing a larger role in health care. The transaction would give Centene a bigger presence in the California Medicaid program, which is the largest in the U.S. with more than 12 million individuals, and provides an entry into the Medicare market.

Health insurers in the U.S. are looking at mergers to cut costs and keep profits expanding after enjoying an influx of new business from the Patient Protection and Affordable Care Act, which brought previously uninsured people into the market for the first time. At the same time, the law put pressure on profit margins by imposing new fees on the companies and mandating that they spend at least 80 percent to 85 percent of premiums on medical claims.

Aetna is said to be nearing an acquisition of Humana, Bloomberg reported last week. And on June 20, Anthem Inc. went public with a bid for Cigna. UnitedHealth Group, the largest U.S. health insurer, could also make a bid for Aetna. And it's possible UnitedHealth could jump in with a competing offer for Health Net, said Ana Gupte, an analyst at Leerink Partners, in a research note Thursday.

Centene will assume about $500 million in debt as part of its transaction with Health Net, which the companies expect to close in early 2016. The buyer plans to fund the purchase using its existing cash and debt financing, with Wells Fargo & Co. providing $2.7 billion in financing commitments, the companies said.

The acquisition will generate an additional 10 percent of diluted earnings in the first year following the closing, according to the statement. Centene Chairman and Chief Executive Officer Michael Neidorff will be the chairman, president and CEO of the combined company, which will be based in St. Louis.

The combined company would have more than 10 million members and an estimated $37 billion in pro forma premium and service revenues for 2015.