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Aetna-Humana and Cigna-Anthem deals both canceled

por Thomas Dworetzky, Contributing Reporter | February 14, 2017
Business Affairs

The Cigna-Anthem breakup was unilateral, and bitter, however. Cigna walked out on its $54 billion deal with Anthem, and is suing for damages.

That deal was blocked in court in early February.

"The evidence has shown that the merger is likely to result in higher prices," U.S. District judge Amy Berman Jackson wrote in the ruling.

"Anthem is encouraging the Court to ignore the risks posed by the proposed constriction in the health insurance industry … on the grounds that consumers might benefit from the large size of the new company in other ways at the end of the day," Jackson said.

Anthem said it wants to give the deal another try. “On January 18, 2017, Anthem extended its merger agreement with Cigna through April 30, 2017. Under the terms of the merger agreement, Cigna does not have a right to terminate the agreement," an Anthem spokesperson told CNBC.

Cigna, however, appears to be seething, which is taking the form of a $1.85 billion termination fee and another $13 billion in damages, according to the Washington Post.

"These additional damages include the amount of premium that Cigna shareholders did not realize as a result of the failed merger process," the company said according to the paper. "The company believes strongly in the merits of its case and hopes that this matter is rapidly resolved."

Anthem disputes the breakup. Its spokeswoman Jill Becher fired to the Post that "Anthem will continue to enforce its rights under the merger agreement."

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