The Cigna Group announces $3.2 billion accelerated stock repurchase

Global health company The Cigna Group will repurchase $3.2 billion of common stock through accelerated stock repurchase agreements with Deutsche Bank AG and Bank of America, N.A.. The ASR Agreements are part of The Cigna Group’s existing share repurchase program, which had remaining authority of $10.6 billion as of February 13, 2024.

“This accelerated share repurchase represents a value-enhancing deployment of capital,” said David M. Cordani, Chairman and Chief Executive Officer, The Cigna Group. “This is a testament to the ongoing growth and strength of our businesses, and we remain committed to returning significant value to our shareholders and investing in our future. We are on track to repurchase $5 billion of common stock over the first half of 2024, inclusive of this accelerated share repurchase, and continue to expect the majority of discretionary cash flow to be used for share repurchase this year.”

Under the terms of the ASR Agreements, on February 15, 2024, the Company will receive an aggregate initial delivery of approximately 7.6 million shares in exchange for a prepayment of $3.2 billion. The specific number of shares that the Company ultimately will repurchase pursuant to the ASR Agreements will be based generally on the daily volume-weighted average share price of The Cigna Group common stock over the term of the ASR Agreements, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR Agreements. Final settlement under the ASR Agreements is expected to occur in the second quarter of 2024. The ASR Agreements contain provisions customary for agreements of this type, including provisions for adjustments to the transaction terms upon certain specified events, the circumstances generally under which final settlement of the ASR Agreements may be accelerated or extended or the ASR Agreements may be terminated early by the Company or the Counterparties, and various acknowledgements and representations made by the parties to each other. At final settlement, under certain circumstances, the Company may be entitled to receive additional shares of The Cigna Group common stock from the Counterparties or the Company may be required to make a cash payment or, if the Company elects, deliver shares of The Cigna Group common stock to the Counterparties. All of the shares of The Cigna Group common stock delivered to the Company under the ASR Agreements will be held in treasury or retired.
MB Bureau