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Cigna free to leave proposed Anthem merger

Friday, May 12, 2017 - 15:27

[NEW YORK] The US health insurer Cigna is free to leave a proposed merger with Anthem, with a judge declining a request for a preliminary injunction to block the exit.

The Delaware Court of Chancery's rejected Anthem's request to stop Cigna from terminating the deal between the health insurance titans, which a federal court has blocked on antitrust concerns.

The judge did stay the ruling's implementation until Monday, allowing Anthem to decide whether to appeal.

"We look forward to closing this final chapter," Cigna told AFP.

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Following Thursday's ruling Anthem did not immediately respond to an AFP request for comment.

Cigna had initially been favourable to Anthem's takeover plan, a US$54 billion merger that would have created the largest US health insurer.

But the company threw in the towel in mid-February after the deal was successfully opposed in federal court by the Department of Justice with backing from eleven US states.

Anthem petitioned the US Supreme Court last week to intervene in that dispute.

Cigna has also filed suit against Anthem demanding a US$1.85 billion breakup fee plus more than US$13 billion in additional damages.

Anthem rejected the claim - calling Cigna's "purported" termination of the deal "invalid". Another proposed health insurer merger, between Aetna and Humana, was blocked in January with a US federal judge ruling that the combination would stifle competition in the health sector.

Those companies said they had mutually agreed to end the merger agreement, with Aetna saying it would pay Humana a US$1 billion breakup fee as set by the agreement.

AFP

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