Aetna, Humana End Merger Agreement
Aetna Inc. and Humana Inc. said on February 14 that they will end their $34 billion merger agreement. The two health insurers decided not to appeal a federal judge’s ruling that blocked the merger on antitrust grounds. Aetna Chief Executive Mark Bertolini said in a statement that they were “disappointed to take this course of action after 19 months of planning, but both companies need to move forward with their respective strategies in order to continue to meet member expectations.”
In a separate statement Humana announced the “mutual termination” of the deal by both companies, and confirmed that it is entitled to a breakup fee of $1 billion, which it said was about $630 million after taxes. In January U.S. District Judge John D. Bates said in a 156-page decision that the proposed merger would unlawfully threaten competition, harming seniors who buy the private Medicare coverage known as Medicare Advantage.