Fitch keeps Cigna on watch

Fitch Ratings said it maintained the Rating Watch Negative for Cigna Corp.’s A- issuer default rating, BBB+ senior unsecured notes and the A+ insurer financial strength ratings of certain subsidiaries.

The action follows the completion of a periodic review of Cigna's ratings.

Fitch had previously placed Cigna's ratings on negative watch on July 24 following the company's announcement that it entered into a definitive agreement to be acquired by Anthem, Inc. Excluding the ratings-negative aspects of that planned acquisition, the agency said it believes that this new review would have resulted in the affirmation of Cigna's ratings with stable outlooks.

Cigna's negative watch status reflects Fitch's expectation that Anthem's post-acquisition financial leverage metrics will be meaningfully higher and its interest-coverage ratios will be meaningfully lower than Cigna's have been in recent years. The negative watch status also reflects potential earnings disruptions that could arise in the short-term subsequent to the acquisition's close as Anthem integrates Cigna from an operational and management perspective, the agency said.

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