Cigna drops on report it is close to selling its Medicare business for $3-4B By Investing.com

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Cigna drops on report it is close to selling its Medicare business for $3-4B By Investing.com


© Reuters. Cigna (CI) drops on report it is close to selling its Medicare business for $3-4B

Health-insurance giant Cigna (NYSE:) is reportedly in advanced negotiations to sell its Medicare business, marking a strategic shift from its recent expansion endeavors in the thriving sector.

The company, running an auction for its Medicare Advantage business, is reportedly in exclusive talks with Health Care Service Corp. for a potential sale valued between $3 billion and $4 billion.

Cigna stock is down 1.3% today.

Cigna, with approximately 599,000 Medicare Advantage members and $7.9 billion in revenue in 2022, is moving forward with the sale despite the breakdown of talks to acquire Medicare-focused insurer Humana, according to the Wall Street Journal.

Investors’ lukewarm response to the proposed megadeal prompted this shift in strategy. Cigna, in response to the changing landscape, now plans an additional $10 billion in stock buybacks and is poised to focus on smaller, incremental acquisitions, often referred to as “bolt-on” acquisitions.



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