Cigna Corporation announced it has exercised its right to terminate the proposed merger agreement with Anthem, Inc. following the order on February 8, 2017 from the U.S. District Court for the District of Columbia enjoining the transaction. In light of the Court’s ruling, Cigna believes that the transaction cannot and will not achieve regulatory approval and that terminating the agreement is in the best interest of Cigna’s shareholders.

To effect this termination, Cigna has filed suit against Anthem in the Delaware Court of Chancery. The suit seeks declaratory judgment that Cigna has lawfully terminated the merger agreement and that Anthem is not permitted to extend the termination date. The complaint seeks payment by Anthem of the $1.85 billion reverse termination fee contemplated in the merger agreement, as well as additional damages in an amount exceeding $13 billion. These additional damages include the amount of premium that Cigna shareholders did not realize as a result of the failed merger process. This action is necessary to enforce and preserve Cigna’s rights and protect the interests of its shareholders. The company believes strongly in the merits of its case and hopes that this matter is rapidly resolved.

The decision to terminate the transaction and seek damages follows the District Court’s findings that the merger would decrease competition and lessen choice in the “national accounts” market, in part because the members of the Blue Cross Blue Shield network work together to win national business, and that the competitive harm could not be offset by claimed efficiencies.

Cigna is disappointed in the outcome of this process. Cigna believed from the outset that the merger of the two companies had the potential to expand choice, improve affordability and quality and further accelerate value-based care. Anthem contracted for and assumed full responsibility to lead the federal and state regulatory approval process, as well as the litigation strategy, under the merger agreement. Cigna fulfilled all of its contractual obligations and fully cooperated with Anthem throughout the approval process.

Future Growth

Cigna will continue to invest in innovative solutions and programs to engage and support customers in their health and life journeys and partner with health care professionals on leading value-based care programs. The company will continue to expand its proven footprint and capabilities across the globe for Individual and Employer customers. Cigna’s approach of focusing on health care services over sick care financing has never been more critical.

Cigna’s 2017 growth outlook for adjusted income from operations of 12%-18% will be further aided by the company’s significant capital available for deployment.

Cigna is also announcing that its Board of Directors has expanded the company’s share repurchase authority to an aggregate amount of $3.7 billion. Management has determined that it is prudent to cap the amount of the repurchase to $250 million per quarter until there is more clarity with respect to the litigation with Anthem. This amount is equivalent to the amount which would have been permitted if the merger agreement were still in effect.

The company looks forward to discussing its strategic growth plan, as well as its plans for future capital deployment, during an Investor Day to be held on March 29, 2017 in New York City.