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Antitrust regulators worry about proposed Cigna-Anthem merger - WSJ

Published 20/06/2016, 01:57
© Reuters. The office building of health insurer Anthem is seen in Los Angeles, California
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(Reuters) - U.S. antitrust regulators are concerned about health insurer Anthem Inc's (N:ANTM) proposed acquisition of Cigna Corp (N:CI) and not sure the companies can offer enough concessions to maintain competition in the industry, the Wall Street Journal reported on Sunday.

Both companies have scheduled meetings this week with top U.S. Department of Justice officials, the Journal reported, citing people familiar with the matter.

Some of the sources said the DOJ had not yet made a decision on whether to sue to block the deal.

Wall Street does not seem convinced the deal will go through, as evidenced in the wide spread between Anthem's offer and Cigna's share price. As of the market close on Friday, Cigna shares traded at a 32.5 percent discount to the offer, which has an equity value of about $44 billion.

© Reuters. The office building of health insurer Anthem is seen in Los Angeles, California

Anthem announced plans to buy Cigna last summer. Also pending is Aetna Inc's (N:AET) acquisition of Humana Inc (N:HUM) which faces significant antitrust concern as well. That deal is valued at about $34 billion.

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