"Early stages of interaction with the [Trump] administration is positive so far," Cigna CEO David Cordani told TheStreet. "We expect the deal to be completed by the end of this year, and are confident the deal will be completed."
That's reassuring news to the market, which has sent shares of Cigna down about 10% since the $67 billion deal for Express Scripts was revealed on Mar. 8. The market has had concerns the vertical deal won't get approved by regulators keen on not giving healthcare companies even more power.
"Given broadly negative feedback from investors and widening of the deal spread for ESRX (now ~17%), the market is suggesting that the path forward may come into question, and government approval for the merger is less than 100% certain," says Evercore ISI analyst Michael Newshel. The analyst adds that investors are also concerned over the sustainability of Express Scripts' profit margins given strong competitive activity.
Cordani believes the combination will help lower healthcare costs and offer more personalized service for consumers.
Check out TheStreet's recent exclusive with Coca-Cola KO CEO James Quincey here.