Anthem sues to stop Cigna from killing $54 billion merger

Cigna sues Anthem for breaking merger agreement

NEW YORK (CNNMoney) - A judge has stopped Cigna from withdrawing from its $54 billion merger with Anthem for the time being.

Cigna called off the deal on Tuesday after it was opposed by the Justice Department and blocked by a federal judge, citing antitrust concerns.

But Anthem won't accept the breakup.

"There is still sufficient time and a viable path forward potentially to complete the transaction," it said in a statement early Wednesday, announcing that it was suing to stop Cigna pulling out.

A Delaware court issued the temporary restraining order later in the day, preventing Cigna from withdrawing anytime soon.

Cigna said the court order was procedural, but it added that it will continue to respect the terms of the merger deal until the court further reviews the case. The next hearing is scheduled for the week of April 10.

The merger is clearly not going well because the insurers are suing each other. Cigna sued Anthem on Tuesday, claiming Anthem breached the merger agreement, which included an obligation to pay a breakup fee of $1.85 billion. Cigna is also seeking $13 billion in damages.

Anthem says in its own suit that Cigna has waged a campaign to sabotage the merger.

It was a big day for breakups in health care on Tuesday. Aetna and Humana called off their $34 billion merger agreement, which was also opposed by the Justice Department and blocked by a federal court.

Last year, then-Attorney General Loretta Lynch sued all four companies to stop the two mergers because she said they ran the risk of "drastically constricting competition" in health care.

The combinations would have the left the industry dominated by three giant insurers, the third company being UnitedHealth.

Humana also said Tuesday it was pulling out of Obamacare for 2018.

--CNNMoney's Rob McLean, Tami Luhby and Jackie Wattles contributed to this report.


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