Two state regulatory agencies conditionally approved Centene Corp.'s acquisition of Health Net Inc., the agencies announced Tuesday.

One of the conditions required by the Department of Managed Health Care is that Health Net keep its headquarters in California. The company is currently headquartered in Woodland Hills.

Also, the combined company, to be called Centene, must build a service center in an economically distressed area of California employing at least 300 people. The company must invest at least $200 million in the project. In addition, the company must spend $140 million to improve health outcomes for underserved communities in the state.

In a separate statement, Insurance Commissioner Dave Jones approved the deal with conditions that include Health Net maintain its insurance lines and that no merger costs are passed onto California consumers.

Health Net and Centene in St. Louis announced the merger last July.

Health Net shares closed up $2.15 or 3.4 percent to $64.81 on the New York Stock Exchange.