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Icahn Drops Cigna–Express Scripts Merger Fight

Analysis  |  By John Commins  
   August 14, 2018

In the face of glowing recommendations by independent analysts, the billionaire hedge fund manager has dropped his opposition to the proposal that last week he called 'a $60 billion folly.'

Carl Icahn has dropped his opposition to Cigna's proposed $54 billion purchase of pharmacy benefits manager Express Scripts, after the deal was vetted and recommended by two independent analysts.

"In light of the ISS and Glass Lewis recommendations in favor of the Cigna/Express Scripts transaction and the significant stockholder overlap between the two companies, we have informed the SEC that we no longer intend to solicit proxies to vote against the transaction," Icahn said in a media release.

Icahn's terse reversal, coming one week after he called the proposal "a $60 billion folly" and urged shareholders to reject the deal, should put an end to a very public spat the billionaire hedge fund manager waged with Cigna leadership.

Cigna CEO David M. Cordani issued a lengthy statement detailing "the favorable recommendations from both Glass Lewis and ISS as momentum continues to build in support of our merger with Express Scripts."

"Their recommendations underscore the significant shareholder value that this transformative merger will deliver in a highly dynamic market environment," Cordani said.

Icahn, who owns a sliver of Cigna's outstanding stock, had argued that Express Scripts is too big and risky of a bet

"Cigna is dramatically overpaying for a highly challenged Express Scripts that is facing existential threats on several fronts," Icahn wrote in his letter to shareholders.

However, his critique provided a sharp contrast to the Glass Lewis analysis, which positively gushed over the proposal, and said it "represents an attractive opportunity to create a more diverse and integrated business model in the evolving healthcare services industry which will be better positioned to serve consumers, adapt to competitive and structural challenges, respond to regulatory changes, capitalize on growth opportunities and potentially realize significant incremental cost savings and operational efficiencies."

John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.


Icahn drops his opposition to the $54 billion merger.

ISS and Glass Lewis analyses back the proposal as a win for shareholders.

Cigna CEO David Cordani crows 'momentum continues to build in support of our merger.'

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