Cigna reveals $67bn acquisition deal in the US
US health insurer Cigna Corporation has entered into a definitive agreement to acquire pharmacy benefit manager Express Scripts for a cash and stock transaction of approximately $67 billion, including about $15 billion in Express Scripts' debt.
According to the company, the merger creates an expanded portfolio of health services for employers, health plans and government agencies.
Upon completion, Cigna is expected to have debt of approximately $41.1 billion. The company said that it expects to have a debt-to-capitalization ratio of approximately 49 percent following the acquisition and aims to achieve a ratio in the 30’s within 18 to 24 months after the transaction closes. Cigna expects to maintain its investment grade ratings.
The combined company will be named Cigna, led by David Cordani as president and CEO. Tim Wentworth will assume the role of president, Express Scripts. The combined company’s board will be expanded to 13 directors, including four independent members of the Express Scripts board.
“Cigna’s acquisition of Express Scripts brings together two complementary customer-centric services companies, well-positioned to drive greater quality and affordability for customers,” said Cordani. “This combination accelerates Cigna’s enterprise mission of improving the health, well-being and sense of security of those we serve, and in turn, expanding the breadth of services for our customers, partners, clients, health plans and communities.
"Together, we will create an expanded portfolio of health services, delivering greater consumer choice, closer alignment between the customer and health care provider, and more personalized value. This combination will create significant benefits to society and differentiated shareholder value,” Cordani added.
Wentworth, CEO of Express Scripts, said: “First and foremost, we believe this transaction delivers attractive value to the Express Scripts shareholders. Together, our two organizations will help make the healthiest choices the easiest choices, putting health and pharmacy services within reach of everyone we serve.
"Adding our company's leadership in pharmacy and medical benefit management, technology-powered clinical solutions, and specialized patient care model to Cigna’s track record of delivering value through innovation, we are positioned to transform healthcare. We will continue to have a distinct focus at Express Scripts and eviCore on partnering with health plans, and together, build tailored solutions for health plans and their members. Importantly, this agreement is a testament to the work of our team and their resolute focus on providing the best care to patients, and the most value to clients.”
