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Cigna Rejects Anthem’s Whopping $47 Billion Bid

It is now evident that health insurer Cigna Corp. is no longer interested in the bid offered by their competitor Anthem. Anthem Inc. has offered $47 billion as the amount to acquire all Cigna’s assets, an offer that was turned down. In rejecting the bid, Cigna cited that the terms are simply inadequate. “They are woefully skewed in favor of Anthem shareholders.” The rejection by Cigna came at the time when their rivals Anthem had published a statement to the public showing the company’s cash-and-stock offer. According to the statement, the cash-and-stock offer amounts to approximately $148 for every Cigna share. This is equated an average of 18 percent premium.

Anthem Inc. could see them reap maximum benefits as a giant health insurer in a society that has seen other health insurers cut their costs in order to survive in what observers see as a saturated health insurance market. Anthem Inc. claimed that if the deal would go through, the company would realize annual revenue of approximately $115 billion as well as providing health insurance to approximately 53 million people. This is, however, a dream as for now since it is not evident if the talks have stalled or there will be efforts to revive the deal. On a statement given out on Sunday, Cigna Corp. said, “Under the right circumstances this would provide substantial benefits to customers, doctors and even investors from both companies.” However, later, there was different information that was contained in a letter signed by two of Cigna Corp’s officials; Connecticut-based Company called Bloomfield showed that Anthem Inc’s offer had a number of obstacles. Because of the obstacles, the offer obviously looked inadequate.

In justifying the turning down of the offer, Cigna Corp said that Anthem Inc. failed in addressing important issues such as regulatory hurdles and other intricate issues that concerned the way the health insurer handles customer data. This information was revealed early this year. The information was obtained from a letter that was signed by Cigna Corp’s Chief Executive Officer David Cordani and the company’s board chairman Isaiah Harris Jr. While, defending the company, the letter showed that Anthem Inc has lost growth strategy over the years. On the other hand, Cigna Corp’s stock has outperformed its rival, especially in recent times. Efforts were undertaken to find Anthem Inc’s Indianapolis branch spokesperson to shed light on few things and possibly react on the allegations leveled against them by their rival Cigna Corp, but she declined comment.

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