The Cigna Group Completes Sale of Medicare Businesses to HCSC
The Cigna Group (NYSE: CI) has completed the sale of its Medicare businesses to Health Care Service (HCSC). The transaction includes the divestment of Medicare Advantage, Cigna Supplemental Benefits, Medicare Part D, and CareAllies businesses.
The majority of the proceeds will be allocated to share repurchases, aligning with Cigna's capital deployment priorities. Cigna will continue providing pharmacy benefit services and other solutions through Evernorth Health Services to the Medicare businesses as part of service agreements with HCSC for an agreed period.
The transaction is designed to maintain continuity, with no disruption to coverage or service for customers, clients, providers, or brokers of the Medicare or CareAllies businesses. Centerview Partners is acting as financial advisor, with Morgan Stanley providing additional financial advice.
Il Gruppo Cigna (NYSE: CI) ha completato la vendita delle sue attività Medicare a Health Care Service (HCSC). La transazione include la dismissione delle attività di Medicare Advantage, Cigna Supplemental Benefits, Medicare Parte D e CareAllies.
La maggior parte dei proventi sarà destinata a riacquisti di azioni, in linea con le priorità di impiego del capitale di Cigna. Cigna continuerà a fornire servizi di benefici farmaceutici e altre soluzioni attraverso Evernorth Health Services alle attività Medicare come parte di accordi di servizio con HCSC per un periodo concordato.
La transazione è progettata per mantenere la continuità, senza interruzioni nella copertura o nei servizi per clienti, clienti, fornitori o broker delle attività Medicare o CareAllies. Centerview Partners funge da consulente finanziario, con Morgan Stanley che fornisce ulteriori consulenze finanziarie.
El Grupo Cigna (NYSE: CI) ha completado la venta de sus negocios de Medicare a Health Care Service (HCSC). La transacción incluye la desinversión de Medicare Advantage, Cigna Supplemental Benefits, Medicare Parte D y CareAllies.
La mayor parte de los ingresos se destinará a recompras de acciones, alineándose con las prioridades de despliegue de capital de Cigna. Cigna continuará proporcionando servicios de beneficios farmacéuticos y otras soluciones a través de Evernorth Health Services para los negocios de Medicare como parte de acuerdos de servicio con HCSC por un período acordado.
La transacción está diseñada para mantener la continuidad, sin interrupciones en la cobertura o el servicio para clientes, clientes, proveedores o corredores de los negocios de Medicare o CareAllies. Centerview Partners actúa como asesor financiero, con Morgan Stanley proporcionando asesoría financiera adicional.
시그나 그룹 (NYSE: CI)가 헬스케어 서비스(HCSC)에게 메디케어 사업을 매각 완료했습니다. 이 거래에는 메디케어 어드밴티지, 시그나 보조 혜택, 메디케어 파트 D 및 케어앨리스 사업의 매각이 포함됩니다.
대부분의 수익은 자사주 매입에 할당될 예정이며, 이는 시그나의 자본 배분 우선순위와 일치합니다. 시그나는 HCSC와의 서비스 계약의 일환으로 메디케어 사업에 대해 에버노스 헬스 서비스(Evernorth Health Services)를 통해 약국 혜택 서비스 및 기타 솔루션을 계속 제공할 것입니다.
이번 거래는 고객, 클라이언트, 제공자 또는 메디케어 또는 케어앨리스 사업의 중개인에게 서비스나 보장에 대한 중단 없이 연속성을 유지하도록 설계되었습니다. 센트뷰 파트너스(Centerview Partners)가 재무 자문 역할을 하며, 모건 스탠리가 추가 재무 자문을 제공합니다.
Le Groupe Cigna (NYSE: CI) a finalisé la vente de ses activités Medicare à Health Care Service (HCSC). La transaction comprend la cession de Medicare Advantage, des prestations complémentaires Cigna, de Medicare Partie D et des activités CareAllies.
La majorité des produits sera affectée à des rachat d'actions, en accord avec les priorités de déploiement de capital de Cigna. Cigna continuera à fournir des services de prestations pharmaceutiques et d'autres solutions via Evernorth Health Services aux activités Medicare dans le cadre d'accords de services avec HCSC pour une période convenue.
La transaction est conçue pour maintenir la continuité, sans interruption de la couverture ou des services pour les clients, clients, fournisseurs ou courtiers des activités Medicare ou CareAllies. Centerview Partners agit en tant que conseiller financier, avec Morgan Stanley fournissant des conseils financiers supplémentaires.
Die Cigna-Gruppe (NYSE: CI) hat den Verkauf ihrer Medicare-Geschäfte an Health Care Service (HCSC) abgeschlossen. Die Transaktion umfasst die Veräußerung von Medicare Advantage, Cigna Supplemental Benefits, Medicare Teil D und CareAllies.
Der Großteil der Einnahmen wird für Aktienrückkäufe verwendet, was mit Cignas Kapitalverwendungsprioritäten übereinstimmt. Cigna wird weiterhin Apothekenleistungen und andere Lösungen über Evernorth Health Services für die Medicare-Geschäfte im Rahmen von Dienstleistungsvereinbarungen mit HCSC für einen vereinbarten Zeitraum bereitstellen.
Die Transaktion zielt darauf ab, Kontinuität zu gewährleisten, ohne Unterbrechungen in der Deckung oder den Dienstleistungen für Kunden, Klienten, Anbieter oder Broker der Medicare- oder CareAllies-Geschäfte. Centerview Partners fungiert als Finanzberater, während Morgan Stanley zusätzliche Finanzberatung leistet.
- Strategic portfolio streamlining to focus on core business
- Majority of proceeds to be used for share repurchases, benefiting shareholders
- Continued revenue stream through pharmacy benefit services agreement with HCSC
- Loss of direct exposure to growing Medicare market segment
- Reduction in business diversification
Insights
Cigna's completion of its Medicare business divestiture to HCSC represents a significant strategic repositioning that streamlines the company's portfolio. This transaction includes the sale of Medicare Advantage, Supplemental Benefits, Medicare Part D, and CareAllies businesses—substantial components of Cigna's Medicare-related operations.
The most immediate investor impact comes from Cigna's capital deployment strategy: the company explicitly states that the majority of proceeds will fund share repurchases. This shareholder-friendly move should support the stock price and potentially enhance earnings per share metrics through a reduced share count.
Despite exiting direct Medicare business ownership, Cigna maintains meaningful exposure to this market through service agreements. The company will continue providing pharmacy benefit services through its Evernorth Health Services division for an agreed period post-closing. This arrangement creates a transitional revenue stream while allowing Cigna to focus on its core operations.
This transaction represents the culmination of Cigna's strategic shift toward simplification and focus. By divesting these Medicare assets, management can allocate more resources and attention to its remaining business segments while still participating in Medicare markets through Evernorth's service offerings.
While shareholders benefit from the repurchase program, the long-term implications depend on how effectively Cigna deploys capital toward remaining growth opportunities after reducing its direct Medicare market participation.
As previously announced, proceeds from the sale will be used in alignment with The Cigna Group's capital deployment priorities, with the majority expected to be allocated to share repurchases.
"We are proud of the positive impact we have made in people's lives and the unique value provided through our Medicare businesses and are confident that HCSC will continue the meaningful work that we have done for these customers. We remain committed to serving Medicare populations through the portfolio of products and services we offer through Evernorth Health Services," said David M. Cordani, Chairman and Chief Executive Officer of The Cigna Group.
The Cigna Group will continue to provide pharmacy benefit services and other solutions to the Medicare businesses through its health services company Evernorth Health Services as part of services agreements with HCSC for an agreed period post-closing.
"This transaction is fully aligned with our mission of expanding access to quality health care by adding capabilities and deepening our geographic presence across
The transaction is not expected to disrupt coverage or service for customers, clients, providers, or brokers of the Medicare or CareAllies businesses. Coverage continues and remains unchanged, helping to ensure that patient care continues seamlessly, with no disruption. Medicare customers with questions about their coverage are able to contact the number on their member ID card.
Advisors
Centerview Partners LLC is acting as financial advisor to The Cigna Group. Morgan Stanley & Co. LLC provided additional financial advice. Wachtell, Lipton, Rosen & Katz is serving as corporate legal counsel, and Rule Garza Howley LLP, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., and Sidley Austin LLP are serving as regulatory counsels.
Cautionary Note Regarding Forward-Looking Statements
This press release, and oral statements made in connection with this release, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on The Cigna Group's current expectations and projections about future trends, events and uncertainties. These statements are not historical facts. Forward-looking statements may include, among others, statements regarding The Cigna Group's future beliefs, expectations, plans, intentions, liquidity, cash flows, financial condition or performance. You may identify forward-looking statements by the use of words such as "believe," "expect," "project," "plan," "intend," "anticipate," "estimate," "predict," "potential," "may," "should," "will" or other words or expressions of similar meaning, although not all forward-looking statements contain such terms.
Forward-looking statements are subject to risks and uncertainties, both known and unknown, that could cause actual results to differ materially from those expressed or implied in forward-looking statements. Such risks and uncertainties include, but are not limited to: our ability to achieve our strategic and operational initiatives; our ability to adapt to changes in an evolving and rapidly changing industry; our ability to compete effectively, differentiate our products and services from those of our competitors and maintain or increase market share; price competition and other pressures that could compress our margins or result in premiums that are insufficient to cover the cost of services delivered to our customers; the potential for actual claims to exceed our estimates related to expected medical claims; our ability to develop and maintain satisfactory relationships with health care payors, physicians, hospitals, other health service providers and with producers and consultants; our ability to maintain relationships with one or more key pharmaceutical manufacturers or if payments made or discounts provided decline; changes in the pharmacy provider marketplace or pharmacy networks; changes in drug pricing or industry pricing benchmarks; our ability to invest in and properly maintain our information technology and other business systems; our ability to prevent or contain effects of a potential cyberattack or other privacy or data security incident; risks related to our use of artificial intelligence and machine learning; political, legal, operational, regulatory, economic and other risks that could affect our multinational operations, including currency exchange rates; risks related to strategic transactions and realization of the expected benefits of such transactions, as well as integration or separation difficulties or underperformance relative to expectations which could lead to an impairment charge; dependence on success of relationships with third parties; risk of significant disruption within our operations or among key suppliers or third parties; potential liability in connection with managing medical practices and operating pharmacies, onsite clinics and other types of medical facilities; the substantial level of government regulation over our business and the potential effects of new laws or regulations or changes in existing laws or regulations; uncertainties surrounding participation in government-sponsored programs such as Medicare; the outcome of litigation, regulatory audits and investigations; compliance with applicable privacy, security and data laws, regulations and standards; potential failure of our prevention, detection and control systems; unfavorable economic and market conditions, the risk of a recession or other economic downturn and resulting impact on employment metrics, stock market or changes in interest rates and risks related to a downgrade in financial strength ratings of our insurance subsidiaries; the impact of our significant indebtedness and the potential for further indebtedness in the future; credit risk related to our reinsurers; as well as more specific risks and uncertainties discussed in our most recent report on Form 10-K and subsequent reports on Forms 10-Q and 8-K available through the Investor Relations section of www.thecignagroup.com. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made, are not guarantees of future performance or results, and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. The Cigna Group undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by law.
About The Cigna Group
The Cigna Group (NYSE:CI) is a global health company committed to creating a better future built on the vitality of every individual and every community. We relentlessly challenge ourselves to partner and innovate solutions for better health. The Cigna Group includes products and services marketed under Cigna Healthcare, Evernorth Health Services or its subsidiaries. The Cigna Group maintains sales capabilities in more than 30 markets and jurisdictions, and has approximately 182 million customer relationships around the world. Learn more at thecignagroup.com.
INVESTOR RELATIONS CONTACT:
Ralph Giacobbe
860-787-7968
Ralph.Giacobbe@TheCignaGroup.com
MEDIA CONTACT:
Justine Sessions
860-810-6523
Justine.Sessions@Evernorth.com
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SOURCE The Cigna Group
FAQ
What Medicare businesses did Cigna (CI) sell to HCSC in March 2024?
How will Cigna (CI) use the proceeds from the Medicare business sale?
Will Cigna (CI) maintain any involvement with the sold Medicare businesses?
How does the HCSC acquisition affect current Medicare customers of Cigna (CI)?
