U.S. court blocks Anthem-Cigna $54 billion deal

(Reuters) – A U.S. federal judge on Wednesday blocked health insurer Anthem Inc’s proposed $54 billion merger with smaller rival Cigna Corp, a deal that would have created the largest U.S. health insurer by membership.

The decision comes after a U.S. judge blocked a similar deal between rivals Aetna Inc and Humana Inc on Jan. 23.

Wednesday’s ruling marks another victory for anti-trust officials, who sued the companies in July last year to stop the deal, saying it would reduce competition and raise prices for consumers.

Cigna is entitled to receive from Anthem a reverse termination fee of $1.85 billion if the deal fails to win regulatory approval.

The U.S. Justice Department filed lawsuits last July asking a federal court to stop Anthem’s purchase of Cigna and Aetna Inc’s acquisition of Humana, arguing that such consolidation among the largest health insurers was anti-competitive.

(Reporting by Akankshita Mukhopadhyay and Dipika Jain in Bengaluru, Diane Bartz in Washington, DC; Editing by Bernard Orr)