Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Exclusive: Cigna seeks sale of group benefits insurance business - sources

Stock MarketsAug 20, 2019 11:31AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A screen displays the logo fro Cigna Corp. on the floor at the NYSE in New York

By David French

(Reuters) - U.S. health insurer Cigna Corp (NYSE:CI) is exploring a sale of its group benefits insurance business, which could be valued at as much as $6 billion, four people familiar with the matter said on Tuesday.

The unit for sale offers disability insurance as well as life and accidental death and dismemberment coverage to clusters of company employees. Cigna's move to shed it underscores its decision to focus on healthcare following its $54-billion acquisition of pharmacy benefits manager Express Scripts (NASDAQ:ESRX) Holding Co last year.

The Bloomfield, Connecticut-based company is working with an investment bank to run an auction for the group benefits business, the sources said. The unit could attract interest from other insurers that already have this product line and are seeking scale in that competitive market, the sources added.

While stating the company does not comment on rumors and speculation, a Cigna spokesman said: "Given the dynamic marketplace, we continually review opportunities to ensure we continue to deliver value to our customers and clients."

The sources asked not to be identified because the matter is confidential.

Cigna's group benefits business sits within the company's group disability and other operations division. This unit reported $1.31 billion of adjusted revenue in the three months to June 30, and covered 15.4 million people as of that date, according to Cigna's second-quarter financial statement.

Other health insurers have carried out similar divestitures. Aetna Inc (NYSE:AET) announced in October 2017 that it would sell its U.S. group life and disability unit for $1.45 billion to Hartford Financial Services Group (NYSE:HIG).

As health insurers face regulatory uncertainty amid political efforts to lower U.S. healthcare costs ahead of the 2020 presidential election, Cigna is hoping the acquisition of Express Scripts will help rein in its own costs.

That deal put Cigna in direct competition with CVS Health Corp (NYSE:CVS), which acquired Aetna last year, as well as UnitedHealth Group Inc (NYSE:UNH) and its pharmacy benefit manager Optum.

Any proceeds from the sale of its group benefits insurance business could help Cigna pay down its long-term debt, which totaled $37 billion as of the end of June.

Exclusive: Cigna seeks sale of group benefits insurance business - sources
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email