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February 15, 2024

Cigna announces $3.2B accelerated stock repurchase

PHOTO | COSTAR Cigna headquarters in Bloomfield.
By David Krechevsky

Bloomfield-based The Cigna Group said Thursday it plans to buy back $3.2 billion of its common stock.

The global health insurance company announced it will repurchase the stock through accelerated stock repurchase agreements with Deutsche Bank and Bank of America.

The buy back is part of Cigna’s existing share repurchase program, which had remaining authority of $10.6 billion as of Feb. 13, the company said.

The repurchase comes weeks after Cigna agreed to sell its Medicare Advantage business to Health Care Service Corp. in a deal valued at $3.7 billion. Cigna said it will use proceeds of that deal, which is expected to close in the first quarter of 2025, for additional share repurchases.

Cigna’s stock price was up less than 1% in early morning trading Thursday, at $338.61, but below its 52-week high of $341.96 per share.

"This accelerated share repurchase represents a value-enhancing deployment of capital," said David M. Cordani, chairman and CEO of 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.”

Cordani said Cigna is “on track to repurchase $5 billion of common stock over the first half of 2024,” and continues to expect “the majority of discretionary cash flow to be used for share repurchase this year."

Under the terms of the repurchase, on Feb. 15, the company will receive an aggregate initial delivery of approximately 7.6 million shares in exchange for a prepayment of $3.2 billion.


 

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