Cigna is selling off $20 billion in senior bonds to fund its pending acquisition of Express Scripts.
The offering is another sign that the insurer could be close to finalizing the deal.
Cigna issued senior notes in 10 parts on Thursday evening. The company plans to use the proceeds, along with cash and bank loans to pay the cash portion of the acquisition along with any fees associated with the transaction and outstanding debt held by Express Scripts, according to a release.
The deal, worth $67 million total, includes $15 million in debt.
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The offering comes just days after the Wall Street Journal reported that antitrust regulators at the Department of Justice are close to finalizing the deal. Cigna has said the deal is on track to close by the end of the year, but sources told the WSJ the regulators could approve the deal within the next several weeks.
The newspaper reported that regulators are also nearing approval of the CVS-Aetna merger, but that may hinge on the companies divesting some Part D assets. In March, CVS issued $40 billion in bonds to fund its $69 billion acquisition.
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If approved, the new companies will represent half of the new "big four" healthcare companies that combine coverage with pharmacy benefit management. The other half includes UnitedHealth and Anthem, both of which have in-house PBMs.
In a recent research note, Leerink analyst Ana Gupta said investors are bullish on the industry’s transformation.
“From our managed care perspective we see the virtual end of the standalone PBM model with deal close signaling a necessary change in the business model as integrated medical and Rx benefits take hold, with risk bearing aligned to employers and government end customers,” she wrote.