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Icahn reverses position on Cigna-Express Scripts deal

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Icahn reverses position on Cigna-Express Scripts deal
David Cordani, president and CEO of CIGNA Corp., appears on CNBC at the New York Stock Exchange, (NYSE) in New York, U.S., March 8, 2018. REUTERS/Brendan McDermid   -   Copyright  Brendan McDermid(Reuters)
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(Reuters) – Activist investor Carl Icahn said on Monday that he no longer intended to solicit proxies to vote against the $52 billion Cigna-Express Scripts deal, a turn around from his position last week when he urged the health insurer’s shareholders to vote against it.

Icahn’s comments come after proxy advisory firms Glass Lewis & Co and Institutional Shareholder Services Inc (ISS), as well as hedge fund Glenview Capital Management, extended their support for the deal.

“In light of the ISS and Glass Lewis recommendations in favour of the Cigna/Express Scripts transaction and the significant stockholder overlap between the two companies, we have informed the SEC (U.S. Securities and Exchange Commission) that we no longer intend to solicit proxies to vote against the transaction,” Icahn said in a statement.

The billionaire investor, who has a long position on Cigna and a short position on Express Scripts, has been vocal in his criticism of the deal and last week said Cigna <CI.N> was overpaying for Express Scripts <ESRX.O>.

At the time, he urged Cigna’s shareholders to rally against the deal at a vote scheduled for Aug. 24, citing regulatory hurdles and the growing threat from Amazon.

The proposed deal between Cigna and Express Scripts, announced in March, was outlined as a new way for the companies to hold onto profits as the U.S. healthcare industry faces greater scrutiny for rising costs.

(Reporting by Tamara Mathias and Manas Mishra in Bengaluru; Editing by Shailesh Kuber)

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