Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. United States
  4. Nyse
  5. Aetna
  6. News
  7. Summary
       US00817Y1082

AETNA

SummaryChartsNewsCompany 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector news

U.S. antitrust officials set to challenge Anthem, Aetna deals - source

07/19/2016 | 03:09pm EDT
The office building of health insurer Anthem is seen in Los Angeles, California

NEW YORK (Reuters) - U.S. antitrust officials will file lawsuits to stop the two large health insurance deals they have been scrutinizing for a year, Anthem Inc's (>> Anthem Inc) acquisition of Cigna Corp (>> CIGNA Corporation) and Aetna Inc's (>> Aetna Inc) takeover of Humana Inc (>> Humana Inc), a person familiar with the matter told Reuters.

NEW YORK (Reuters) - U.S. antitrust officials will file lawsuits to stop the two large health insurance deals they have been scrutinizing for a year, Anthem Inc's (>> Anthem Inc) acquisition of Cigna Corp (>> CIGNA Corporation) and Aetna Inc's (>> Aetna Inc) takeover of Humana Inc (>> Humana Inc), a person familiar with the matter told Reuters.

Antitrust regulators have been concerned that consolidation of the nation's largest insurers would raise prices for Americans. Anthem and Aetna have said the deals will help consumers by giving the companies the scale to create more cost savings for customers.

The department's decision could be announced by the end of next week, the source familiar with the matter added.

Since the deals were announced a year ago, investors have doubted that the $48 billion Anthem-Cigna combination would go through. Both companies manage health benefits for the nation's employers, who sponsor insurance for more than 150 million people.

Anthem officials said in May that the Justice Department was particularly concerned about how the purchase would affect large companies with employees nationwide. Analysts have said it would be difficult to sell assets to a competitor to answer those concerns.

Until recent weeks, investors were betting that the $34 billion Aetna-Humana combination was less troublesome and could be approved if the companies sold some Medicare assets. But as the Justice Department's "significant concerns" about both deals became public earlier this month, expectations rose that the antitrust regulators would sue to block that transaction as well.

Aetna's purchase of Humana would combine two of the largest providers of Medicare Advantage plans for elderly people. Sources have told Reuters that the companies had presented a divestment plan and the names of possible buyers to the Justice Department less than two weeks ago.

Anthem, Cigna and Aetna declined to comment. Humana and the Justice Department were not immediately available for comment.

Aetna shares fell 4 percent to $113.40 and Humana fell 5 percent to $151.49. Anthem fell 3 percent to $130.93 and Cigna fell 2.4 percent to $129.94.

The two deals were announced after years in which the health insurers were contending with new costs and taxes associated with President Barack Obama's national healthcare reform law, called the Affordable Care Act, as the companies said they need more scale to compete.

The deals would reduce the number of large insurers to three from the current five. UnitedHealth Group Inc (>> UnitedHealth Group Inc), now the largest insurer, would have ranked as the second largest between Anthem and Aetna.

Leerink Partners analyst Ana Gupte said in a research note that she expects the companies to fight the Department of Justice, but that Anthem's and Cigna's chances of success were slim.

Indeed, a source familiar with the situation told Reuters earlier this month that Aetna was prepared to fight the Justice Department.

If there are no deals, Gupte said she expects Humana and Cigna to use their strong cash positions to buy back shares or make small acquisitions. WellCare Health Plans (>> WellCare Health Plans, Inc.), Molina Healthcare Inc (>> Molina Healthcare, Inc.) and Centene Corp (>> Centene Corp) are possible targets, she said, though only WellCare is potentially open to a deal.

Bloomberg first reported that the Justice Department had decided to sue to block the mergers as soon as this week.

(Reporting by Caroline Humer; additional reporting by Diane Bartz; Editing by Phil Berlowitz and Bernard Orr)

By Caroline Humer


ę Reuters 2016
Stocks mentioned in the article
ChangeLast1st jan.
ANTHEM, INC. 0.08% 395.59 Delayed Quote.23.11%
CIGNA CORPORATION -1.06% 231.48 Delayed Quote.11.19%
HUMANA INC. 0.17% 426.21 Delayed Quote.3.71%
MOLINA HEALTHCARE, INC. 0.48% 278.79 Delayed Quote.30.45%
UNITEDHEALTH GROUP -0.09% 421.54 Delayed Quote.20.21%
All news about AETNA
2019UnitedHealth profit beats expectations, shares rise
RE
2018AETNA : Medicaid Announces New Innovative Approach for Members
PU
2018AETNA : UPMC Pinnacle Expand Accountable Care Relationship in Central Pennsylvan..
PU
2018A.M. BEST : Affirms Credit Ratings of Aetna, Inc. and Its Subsidiaries; Affirms ..
BU
2018CVS HEALTH : Completes Acquisition of Aetna, Marking Start of Transforming Consu..
PR
2018Walgreens, Humana in talks to take stakes in each other - WSJ
RE
2018CVS now expects Aetna deal to close after Thanksgiving
RE
2018AETNA : Opens Support Lines to the Public Following Mercy Hospital Shooting on C..
PU
2018AETNA : Hudson Headwaters joins Aetna's New York network in Adirondack, North Co..
BU
2018AETNA : Offers Assistance to Members Affected by Wildfires in California
BU
More news
Chart AETNA
Duration : Period :
Aetna Technical Analysis Chart | US00817Y1082 | MarketScreener
Managers and Directors
Karen S. Lynch President & Director
Carol Ann DeNale Treasurer & Director
Colleen M. McIntosh Director
Thomas S. Moffatt Director & Vice President
Chung-I Lee Secretary & Vice President
Sector and Competitors
1st jan.Capi. (M$)
AETNA17.91%0
UNITEDHEALTH GROUP20.31%398 148
ANTHEM, INC.21.55%96 378
CIGNA CORPORATION12.38%80 282
HUMANA INC.4.71%54 677
CENTENE CORPORATION15.49%40 422