Managed care company Cigna Corp. said Wednesday it plans to offer about 15 million shares of its common stock to help pay for a portion of its $3.8 billion acquisition of fellow insurer HealthSpring Inc.
Cigna, based in Bloomfield, Conn., will grant underwriters a 30-day option to buy an additional 2.25 million shares to cover excess demand.
The company said last month it plans to buy HealthSpring to build its Medicare Advantage business. Medicare Advantage plans are privately run versions of the government's Medicare insurance program for the elderly and disabled.
HealthSpring has about 340,000 Medicare Advantage customers in 11 states, while Cigna only has about 45,000 customers in Arizona.
Cigna shares fell 76 cents to $43.48 in Wednesday morning trading, slightly deeper than a nearly 1 percent drop by broader trading indexes.