Aetna Humana Cigna and Anthem are sitting on nearly $40 billion in cash
16 February, 2017, 00:38
Cigna sued Anthem in DE court Tuesday for $15 billion in damages and termination fees as it seeks to pull the plug on the companies' planned $54 billion merger - but Anthem said its fellow health insurer couldn't legally drop the deal.
Anthem filed its suit in the same court, the Delaware Court of Chancery, seeking a temporary restraining order to block Cigna from ending their agreement, reportsThe Wall Street Journal.
An Anthem statement said despite the court ruling Cigna "does not have the right" to terminate the agreement, saying Cigna "failed to perform fully its obligations in a manner" resulting in the failure of the merger.
Aetna and Humana called off a $34 billion proposal to combine the two major health insurers after a federal judge, citing antitrust concerns, shot down the deal. "Under the terms of the Merger Agreement, Cigna does not have a right to terminate the agreement", an Anthem spokesperson told CNBC. Anthem is appealing that decision, while Cigna tries to get out of the deal completely. Aetna will also redeem $10.2 billion in mandatory redeemable notes that were issued last June to fund the deal.
Cigna said Tuesday it is rejecting Anthem's proposed $48 billion acquisition bid and suing the insurer. Cigna alleged that Anthem "willfully breached" the merger agreement in a way that made it unlikely the deal would be approved and has harmed Cigna's shareholders.
Anthem responded that the merger agreement was in place until April 30, 2017, and that Cigna could not back out.
Aetna and Humana have both pulled out of multiple states serviced by the Obamacare exchanges, leaving consumers with fewer competitors in the marketplace. Aetna had agreed to sell Molina some of its Medicare Advantage plans to win court approval for the Humana deal.
Both deals drew in the Justice Department and separate federal courts ruled the deals could hurt consumers. That merger was denied largely on the grounds that it would threaten competition over large employer-based plans.
Another mega-merger between Anthem and Cigna was canceled several hours later, this one did not end as well.
Other insurers offering federal marketplace plans in the state are Blue Cross and Blue Shield of Louisiana, more than 134,000 people past year, and Vantage Health, about 42,000 people.
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I always want to continue to get better and look for ways where I am going to be able to push my game. City were crowned champions of the Super League last season after going the entire season unbeaten.