Reply To: Traders Market Weekly: Market Combustion, Short Squeeze Meets Fed Pivot


Cigna $CI and Humana $HUM reportedly scrapped plans to merge after being unable to agree on financial terms, including price via WSJ

Cigna will instead seek out bolt-on acquisitions and conduct a major stock buyback, according to The Wall Street Journal. The Journal first reported the companies were in merger talks late last month.

Investors failed to embrace the idea of a merger, with Cigna shares dropping 8% following news of an impending deal and trending lower since. Humana shares have also taken a significant hit.

The newspaper said Sunday that the proposed merger deal would have had Cigna acquiring Humana in a cash-and-stock deal with a “large” stock component.

– Cigna Intends to Repurchase at Least $5 Billion of Common Stock by End of First Half of 2024
“We believe Cigna’s shares are significantly undervalued and repurchases represent a value-enhancing deployment of capital as we work to support high-quality care, improved affordability, and better health outcomes,” said David M. Cordani, Chairman and Chief Executive Officer, The Cigna Group. “As we look at the broader landscape and the strategic opportunities before us, we will remain financially disciplined with a clear focus on executing against our strategy, delivering value for our shareholders, and investing in our future. In light of the current environment, we will consider bolt-on acquisitions aligned with our strategy, as well as value-enhancing divestitures.”