Court documents reveal a contentious relationship, and now neither party will receive compensation for the failed merger.
May 4, 2021 / Jeff Lagasse, Associate Editor
The Delaware Supreme Court ruled Monday that health insurer Cigna won’t receive a $1.85 billion breakup fee after the dissolution of its attempted merger with Anthem. Neither entity will receive any funds for the breakup, the court decided, backing up a previous decision from Chancery Court Vice Chancellor J. Travis Laster in 2020.
“Neither side can recover from the other,” wrote Laster in the 2020 ruling. “Each must deal independently with the consequences of their costly and ill-fated attempt to merge.”
WHAT’S THE IMPACT
The merger attempt was initiated back in 2015, with Anthem setting its sights in purchasing Cigna for around $54 billion in a deal that would have created the largest health insurer in the U.S.
The relationship began to deteriorate the year after the merger was announced. At about the same time, the U.S. Department of Justice sought to block the deal, citing antitrust concerns. In 2017, a federal court sided with the DOJ, saying that the merger would decrease competition.