Icahn urges Cigna shareholders to vote against Express Scripts deal

[August 07, 2018]  (Reuters) - Billionaire investor Carl Icahn on Tuesday urged Cigna Corp <CI.N> shareholders to vote against the health insurer's $52 billion purchase of Express Scripts Holding Co <ESRX.O>, citing regulations and the growing threat of Amazon.Com Inc <AMZN.O>.

The Cigna-Express Scripts deal has drawn investor skepticism over concerns that Amazon.com's <AMZN.O> entry will upend the healthcare sector and President Donald Trump's push to cut rebates will hurt profitability of pharmacy benefit managers such as Express Scripts.

"When Amazon starts to compete as we believe they will, with their 100 million Prime users and scale distribution system, they will have no trouble breaking into the so-called ecosystem," Icahn wrote in the letter.

"With lower prices, the beneficiary will be American consumer, not the owners of Express Scripts."

Icahn, who has a long position on Cigna and a short position on Express Scripts, said in a letter https://carlicahn.com/open-letter-to-cigna-stockholders titled "Cigna's $60 billion folly" that the insurer was overpaying for Express Scripts.

Last week, Cigna said it was confident of winning shareholder approval for its Express Scripts deal. The shareholder vote is due on Aug. 24.

Cigna and Express Scripts were not immediately available for comment.

(Reporting by Ankur Banerjee in Bengaluru; Editing by Sriraj Kalluvila and Saumyadeb Chakrabarty)

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