Bloomberg reported that Delaware Chancery Court temporarily blocked an effort by Cigna to pull out of the deal and avoid a nearly $2 billion break-up fee. The ruling came after two other health insurance giants Aetna and Humana dropped merger plans after a ruling from a federal judge.
Anthem earlier announced that it has filed a lawsuit in the Delaware Court of Chancery seeking a temporary restraining order to enjoin Cigna from terminating, and taking any action contrary to the terms of, the merger agreement.
“On January 18, Anthem extended its merger agreement with Cigna through April 30. In addition to the fact that Anthem extended the termination date in the merger agreement, Cigna does not have a right to terminate the merger agreement at all because it has failed to perform fully its obligations in a manner that has proximately caused or resulted in the failure of the merger to have been consummated,” Anthem claimed.
In addition to the fact that Anthem extended the termination date of the merger agreement, Anthem claims Cigna does not have a right to terminate the merger agreement at all because it has failed to perform its obligations.
Anthem, according to a release, believes that there is still sufficient time and a path forward potentially to complete the transaction that will save millions of Americans more than $2 billion in annual medical costs and deliver significant value to shareholders.
In addition to filing this lawsuit, Anthem is pursuing an expedited appeal of the U.S. District Court’s decision and is committed to completing the merger either through a successful appeal or through settlement with the Department of Justice, the release stated.
In addition to filing this lawsuit, Anthem is pursuing an expedited appeal of the District Court’s decision and is committed to completing this value-creating merger either through a successful appeal or through settlement with the new leadership at the Department of Justice.
Cigna’s lawsuit and purported termination is the next step in Cigna’s campaign to sabotage the merger and to try to deflect attention from its repeated willful breaches of the Merger Agreement in support of such effort.
The release went on to claim that “Cigna’s obvious efforts to sabotage the merger have been recognized by both the District Court and the national media. As the District Court noted, it could not ignore the ;elephant in the courtroom,’ and the fact that Cigna was “actively warning against” the merger and that Cigna officials provided compelling testimony undermining Anthem’s defense.”