Cigna (NYSE: CI) saw its shares decline in premarket trading on Monday following reports that the U.S. insurer is looking to restart merger efforts with smaller competitor Humana (NYSE: HUM), after previously abandoning the pursuit last year.
According to a Bloomberg News report on Friday, the companies have engaged in informal, preliminary discussions about a potential deal, though no agreement has been reached. Either Cigna or Humana could decide to delay the merger talks until next year or abandon them altogether, Bloomberg noted.
Humana’s shares rose slightly before the Wall Street opening on Monday, building on gains from after-hours trading on Friday. Humana is currently valued at approximately $32 billion, while Cigna has a market capitalization of around $94 billion, as reported by LSEG data cited by Reuters.
Both companies declined to comment, according to Reuters.
Cigna had previously called off its efforts to acquire Humana last December due to disagreements over pricing.
Cigna, which primarily focuses on employer-sponsored healthcare plans, is currently in the process of selling its Medicare Advantage division, which manages government-supported plans for those aged 65 and older. The company has reached an agreement to sell this unit to Health Care Service Corp. for $3.3 billion.
In contrast, Humana has been facing challenges with declining membership in its successful Medicare Advantage plans. The company also reported in July that demand for medical care exceeded projections in the second quarter, raising concerns among investors that the recent increase in medical costs for health insurers might not subside soon.
Medical costs have been rising across the industry since late 2023, as older adults resumed health procedures that had been postponed due to the COVID-19 pandemic. Additionally, government reimbursements for managing healthcare for Medicare members have been slow.
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