US: Judge rules Cigna can abandon merger; Anthem terminates the deal

After a judge ruled that Cigna can walk away from its long-troubled tie-up with Anthem, the larger insurer officially called off the deal. But Anthem also made clear it has no intention of paying a $1.85 billion breakup fee.

On Thursday, the Delaware Chancery Court denied Anthem’s request for a preliminary injunction to keep Cigna from exiting their merger agreement, Anthem confirmed in a statement. In light of that decision, “Anthem has delivered to Cigna a notice terminating the merger agreement,” the company said.

During a hearing Thursday about the injunction, Vice Chancellor Travis Laster acknowledged that his decision would let Cigna exit the deal and “effectively end Anthem’s path to closing,” according toReuters. However, he had given Anthem until noon on Monday to decide whether to pursue an appeal to the Delaware Supreme Court.

In February, a federal judge blocked the insurers’ deal, ruling that it violates antitrust law. Shortly after, Cigna sued Anthem, seeking to end their merger agreement and asking for more than $14 billion in damages.

In response, Anthem filed, and was granted, a temporary restraining order to keep Cigna in the contract while it pursued an appeal of the judge’s ruling. But when that appeal failed, the insurer sought a 60-day extension to keep Cigna in their contract while Anthem attempted to appeal the case to the US Supreme Court.

Full Content: CNBC

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