Aetna And Humana End Merger Deal After 19 Months

14 Février, 2017, 16:38 | Auteur: Stephane Girardot
  • Aetna Gives Up On Merger, Will Pay Humana $1B Breakup Fee

Health Insurance providers Aetna and Humana announced Tuesday morning that they would not seek an appeal on the US federal court's decision to block their $34 billion merger. Humana said it is entitled to a breakup fee of $1 billion, or about $630 million, net of tax. The U.S. Justice Department last July sued to block the $37 billion Aetna-Humana merger, as well as another merger planned between Anthem and Cigna.

"It's good to have a resolution to the Humana-Aetna proposed merger after 19 months".

Health insurers Aetna Inc.

Additionally, Aetna said it has terminated its previously announced agreement to sell parts of its Medicare Advantage businesses to Molina Healthcare Inc. The "proffered efficiencies do not offset the anti-competitive effects of the merger" because it's likely to "substantially lessen competition" in both Medicare Advantage markets and in the public insurance exchanges, the judge ruled.

At 4:15 p.m., Humana will release a 2017 earnings forecast and hold a call with investors.

However, he said, "the current environment makes it too challenging to continue pursuing the transaction".

Both companies would have combined to form the second-largest health insurer in the US. (HUM) said they have mutually ended their merger agreement following a ruling from the United States District Court for the District of Columbia granting a United States Department of Justice request to enjoin the merger.

Justin Sayers reports for The (Louisville) Courier-Journal; Nathan Bomey reports for USA TODAY.

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