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FOR IMMEDIATE RELEASE
OLDWICK - JUNE 24, 2015 03:18 PM (EDT)
A.M. Best has placed the financial strength rating (FSR) of A (Excellent) and the issuer credit ratings (ICR) of "a" of the key life/health subsidiaries, the medical health maintenance organizations (HMO) and dental HMO subsidiaries of Cigna Corporation (collectively referred to as Cigna) (Bloomfield, CT) [NYSE: CI] under review with developing implications. Concurrently, the ICR of "bbb" of Cigna and its existing debt ratings have been placed under review with developing implications. A.M. Best also has placed the FSRs of A- (Excellent) and the ICRs of "a-" of four Cigna supplemental benefit companies and six Cigna HealthSpring companies under review with developing implications. (Please see link below for a detailed listing of the companies and ratings.).
The actions follow the recent public announcement by Anthem, Inc. (Anthem) (Indianapolis, IN) [NYSE: ANTM] of its intent to acquire Cigna for $184 a share in cash and stock. Although the price represents significant premium to Cigna' stock price, Cigna's board publicly rejected the proposal, claiming that it is not in the best interest of shareholders. However, Anthem reiterated its commitment to the proposal and publicly disclosed details of the potential transaction. The transaction is planned to be financed through a combination of cash and new debt with expected financial leverage reaching around 50% following the deal completion. The acquisition will be subject to regulatory approval in multiple jurisdictions, which could extend until the end of 2016.
The under review status reflects the high degree of uncertainty regarding the final outcome of Cigna –Anthem negotiations. A.M. Best will continue its discussions with Cigna's management team and conduct further analysis to determine the final rating opinion.
For a complete listing of FSRs, ICRs and debt ratings for Cigna's key life/health subsidiaries, medical health maintenance organizations (HMO) and dental HMO subsidiaries, please visit Cigna Corporation.
This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best's Ratings & Criteria Center.
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