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HomeHealthCigna shares slide after report it might merge with Humana

Cigna shares slide after report it might merge with Humana

The Cigna Group headquarters in Bloomfield, Connecticut, on Oct. 27, 2023.

BlooJoe Buglewicz | Bloomberg | Getty Photos

Shares of Cigna slid Wednesday after a report that the corporate is in talks with Humana a few merger between the 2 health-care giants.

A Cigna spokesperson didn’t instantly reply to CNBC’s request for touch upon the report from The Wall Road Journal, which cited individuals accustomed to the matter. A Humana spokesperson declined to remark.

The businesses are discussing a stock-and-cash deal that might be finalized by the tip of this yr, the individuals advised the Journal. 

A merger could be a mega deal. Cigna’s market worth sat at roughly $80 billion on Wednesday and Humana’s was round $63 billion, making them two of the nation’s largest well being insurers.

Shares of Cigna fell greater than 5% Wednesday, whereas Humana’s inventory was comparatively flat.  

The rumored deal comes after experiences earlier this month that Cigna was exploring a sale of its Medicare Benefit enterprise, which manages authorities medical health insurance for individuals age 65 and older. A Cigna spokesperson on the time stated the corporate doesn’t touch upon “rumors or hypothesis.” 

Some analysts have advised {that a} potential mixture with Humana might be a cause for Cigna to dump its Medicare Benefit enterprise. Removing that enterprise might probably mood antitrust issues for such a merger, Scott Fidel, well being care inventory analyst at Stephens, wrote in a notice earlier this month, in keeping with STAT Information. 

“We might see this motion being one element of a possible pursuit of Humana as an acquisition goal, with the divestiture being a proactive transfer to scale back antitrust threat,” Fidel stated.

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