- Aetna has entered into two agreements to repurchase shares amounting to $3.3 billion of its own stock.
- Meanwhile, three Humana senior executives sold 26,894 shares of the company stock for $5.5 million after eight, including CEO Bruce Broussard, sold a combined 323,648 shares for $66 million – totaling almost $73.8 million in shares sold, The Courier-Journal reports.
- The health insurance giants' strategies for adjusting their financials come after their failed $37 billion merger.
Last week, the companies mutually agreed to drop their merger plans after the court ruling that blocked the deal in an antitrust case brought on by the U.S. Department of Justice last July and Aetna paid Humana the $1 billion contractual breakup fee. Aetna CEO Mark T. Bertolini stated "both companies need to move forward with their respective strategies in order to continue to meet member expectations." The federal judge concluded the deal would have adversely affected competition, primarily in the Medicare Advantage (MA) market.
Humana executives "had limited opportunities to engage in stock transactions for the last two years owing to the Aetna transaction," company spokesman Tom Noland told The Courier-Journal. "Because of those limitations, some senior executives are now exercising options and/or selling stock for personal financial planning." Earlier this month, the payer reported a $401 million loss in 2016 Q4 and announced it will not be participating in the ACA exchanges for 2018 because it is "seeing further signs of an unbalanced risk pool."
Aetna is still facing a lawsuit filed by its shareholders who argue the company had withdrawn from profitable ACA exchanges and remained in some unprofitable ones but its statements resulted in stock prices being artificially high. Bertolini recently said the company will not re-enter the ACA exchanges it pulled out of and that the federal healthcare law has failed to meet its goals. However, terminating the merger will allow both companies to pursue initiatives other than stock transactions. This could in turn help increase their earnings and shares.