On Sept. 4, Fitch downgraded Cigna to “BBB” from “A-” due to the health insurer’s financing of up to $24 billion in new debt related to the Express Scripts transaction.
The agency also removed Cigna from rating watch negative and issued a stable outlook for the health insurer.
Assuming performance consistent with rating sensitivities detailed in September, Fitch said it does not expect to take further rating actions related to Cigna’s acquisition of Express Scripts.
“While Fitch believes that the potential strategic benefits associated with the combination of these companies are significant, the above referenced actions were taken to reflect Fitch’s concerns regarding the sharp rise in financial leverage for the organization, potential operational disruptions related to integration, uncertainty around achievement of profitability targets and material addition of goodwill,” the agency said.
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