Filed by Aetna Inc.
Pursuant to Rule 425 of the Securities
Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Humana Inc.
(Commission File No.: 001-05975)
The following communication was
distributed on Aetna’s internal website:
FINAL – 7/23/15, 11:30
am
HEADLINE: Mark Bertolini on
Anthem/Cigna Announcement
Aetna’s mission
is to build a healthier world. We are committed to leading a transformation in health care, and to creating new products and services
that will result in more healthy days for our members. Our pending acquisition of Humana aligns with this strategy and will
accelerate our ability to realize our mission.
Humana is not only
a leading Medicare Advantage business, but it also has a strong Health Services business, innovative Consumer assets, a leading
pharmacy benefit manager (PBM), and relationships with providers that align with our accountable care strategy. Most importantly,
with our shared culture and vision, our combined company will be well positioned to achieve our Vision 2020 aspirations.
Today, Anthem and Cigna
announced plans to combine. This news does not at all change Aetna’s vision or our commitment to acquire Humana. While
these transactions will likely be discussed together in the media and elsewhere under the broad heading of “industry consolidation,”
they are actually two very distinct deals that involve different products and would result in two very different companies.
This is an exciting
time for Aetna and the health care industry. While there will be media attention on the many aspects of the various deals,
we need to remain focused on our current operating plan and strategy for the future. With your commitment and continued
good work, we will achieve our vision of a healthier world.
-mark
Important Information For Investors
And Shareholders
This communication does not constitute
an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. In connection
with the proposed transaction between Aetna Inc. (“Aetna”) and Humana Inc. (“Humana”), Aetna and Humana
will file relevant materials with the Securities and Exchange Commission (the “SEC”), including an Aetna registration
statement on Form S-4 that will include a joint proxy statement of Aetna and Humana that also constitutes a prospectus of Aetna,
and a definitive joint proxy statement/prospectus will be mailed to stockholders of Aetna and Humana. INVESTORS AND SECURITY HOLDERS
OF AETNA AND HUMANA ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS THAT WILL BE FILED WITH THE SEC
CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and
security holders will be able to obtain free copies of the registration statement and the joint proxy statement/prospectus (when
available) and other documents filed with the SEC by Aetna or Humana through the website maintained by the SEC at http://www.sec.gov.
Copies of the documents filed with the SEC by Aetna will be available free of charge on Aetna’s internet website at http://www.Aetna.com
or by contacting Aetna’s Investor Relations Department at 860-273-8204. Copies
of the documents filed with the SEC by Humana will be available free of charge on Humana’s internet website at http://www.Humana.com
or by contacting Humana’s Investor Relations Department at 502-580-3644.
Aetna, Humana, their respective
directors and certain of their respective executive officers may be considered participants in the solicitation of proxies in
connection with the proposed transaction. Information about the directors and executive officers of Humana is set forth
in its Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on February 18, 2015, its
proxy statement for its 2015 annual meeting of stockholders, which was filed with the SEC on March 6, 2015, and its Current Report
on Form 8-K, which was filed with the SEC on April 17, 2015. Information about the directors and executive officers of Aetna
is set forth in its Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the SEC on February
27, 2015, its proxy statement for its 2015 annual meeting of shareholders, which was filed with the SEC on April 3, 2015 and its
Current Reports on Form 8-K, which were filed with the SEC on May 19, 2015 and May 26, 2015. Other information regarding
the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or
otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC when
they become available.
Cautionary Statement Regarding
Forward-Looking Statements
This communication contains forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. You can generally identify forward-looking statements by the use of forward-looking terminology
such as “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “explore,” “evaluate,” “intend,” “may,” “might,”
“plan,” “potential,” “predict,” “project,” “seek,” “should,”
or “will,” or the negative thereof or other variations thereon or comparable terminology. These forward-looking
statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond Aetna’s
and Humana’s control.
Statements in this communication
regarding Aetna that are forward-looking, including Aetna’s projections as to the anticipated benefits of the pending Humana
acquisition, are based on management’s estimates, assumptions and projections, and are subject to significant uncertainties
and other factors, many of which are beyond Aetna’s and Humana’s control. Important risk factors could cause actual
future results and other future events to differ materially from those currently estimated by management, including, but not limited
to: the timing to consummate the proposed Humana acquisition; the risk that a condition to closing of the proposed Humana acquisition
may not be satisfied; the risk that a regulatory approval that may be required for the proposed Humana acquisition is delayed,
is not obtained or is obtained subject to conditions that are not anticipated; Aetna’s ability to achieve the synergies
and value creation contemplated by the proposed Humana acquisition; Aetna’s ability to promptly and effectively integrate
Humana’s businesses; the diversion of management time on acquisition-related issues; unanticipated increases in medical
costs (including increased intensity or medical utilization as a result of flu or otherwise; changes in membership mix to higher
cost or lower-premium products or membership-adverse selection; medical cost increases resulting from unfavorable changes in contracting
or re-contracting with providers (including as a result of provider consolidation and/or integration); and increased pharmacy
costs (including in Aetna’s and Humana’s health insurance exchange products)); the profitability of Aetna’s
and Humana’s public health insurance exchange products, where Aetna membership is higher than Aetna projected and may have
more adverse health status and/or higher medical benefit utilization than Aetna and/or Humana projected; uncertainty related to
Aetna’s and Humana’s accruals for health care reform’s reinsurance, risk adjustment and risk corridor programs
(“3R’s”); the implementation of health care reform legislation, including collection of health care reform fees,
assessments and taxes through increased premiums; adverse legislative, regulatory and/or judicial changes to or interpretations
of existing health care reform legislation and/or regulations (including those relating to minimum medical loss ratio (“MLR”)
rebates); the implementation of health insurance exchanges; Aetna’s and Humana’s ability to offset Medicare Advantage
and PDP rate pressures; and changes in Aetna’s and Humana’s future cash requirements, capital requirements, results
of operations, financial condition and/or cash flows. Health care reform will continue to significantly impact Aetna’s
business operations and financial results, including Aetna’s pricing and medical benefit ratios. Key components of
the legislation will continue to be phased in through 2018, and Aetna will be required to dedicate material resources and incur
material expenses during 2015 to implement health care reform. Certain significant parts of the legislation, including aspects
of public health insurance exchanges, Medicaid expansion, reinsurance, risk corridor and risk adjustment and the implementation
of Medicare Advantage and Part D minimum MLRs, require further guidance and clarification at the federal level and/or in the form
of regulations and actions by state legislatures to implement the law. In addition, pending efforts in the U.S. Congress
to amend or restrict funding for various aspects of health care reform, and litigation challenging aspects of the law continue
to create additional uncertainty about the ultimate impact of health care reform. As a result, many of the impacts of health
care reform will not be known for the next several years. Other important risk factors include: adverse changes in health
care reform and/or other federal or state government policies or regulations as a result of health care reform or otherwise (including
legislative, judicial or regulatory measures that would affect Aetna’s and/or Humana’s business model, restrict funding
for or amend various aspects of health care reform, limit Aetna’s and/or Humana’s ability to price for the risk it
assumes and/or reflect reasonable costs or profits in its pricing, such as mandated minimum medical benefit ratios, or eliminate
or reduce ERISA pre-emption of state laws (increasing Aetna’s and/or Humana’s potential litigation exposure)); adverse
and less predictable economic conditions in the U.S. and abroad (including unanticipated levels of, or increases in the rate of,
unemployment); reputational or financial issues arising from Aetna’s and/or Humana’s social media activities, data
security breaches, other cybersecurity risks or other causes; Aetna’s ability to diversify Aetna’s sources of revenue
and earnings (including by creating a consumer business and expanding Aetna’s foreign operations), transform Aetna’s
business model, develop new products and optimize Aetna’s business platforms; the success of Aetna’s Healthagen®
(including Accountable Care Solutions and health information technology) initiatives; adverse changes in size, product or geographic
mix or medical cost experience of membership; managing executive succession and key talent retention, recruitment and development;
failure to achieve and/or delays in achieving desired rate increases and/or profitable membership growth due to regulatory review
or other regulatory restrictions, the difficult economy and/or significant competition, especially in key geographic areas where
membership is concentrated, including successful protests of business awarded to Aetna and/or Humana; failure to adequately implement
health care reform; the outcome of various litigation and regulatory matters, including audits, challenges to Aetna’s and/or
Humana’s minimum MLR rebate methodology and/or reports, guaranty fund assessments, intellectual property litigation and
litigation concerning, and ongoing reviews by various regulatory authorities of, certain of Aetna’s and/or Humana’s
payment practices with respect to out-of-network providers, other providers and/or life insurance policies; Aetna’s ability
to integrate, simplify, and enhance Aetna’s existing products, processes and information technology systems and platforms
to keep pace with changing customer and regulatory needs; Aetna’s ability to successfully integrate Aetna’s businesses
(including Humana, Coventry, bswift LLC and other businesses Aetna may acquire in the future) and implement multiple strategic
and operational initiatives simultaneously; Aetna’s and/or Humana’s ability to manage health care and other benefit
costs; adverse program, pricing, funding or audit actions by federal or state government payors, including as a result of sequestration
and/or curtailment or elimination of the Centers for Medicare & Medicaid Services’ star rating bonus payments; Aetna’s
ability to reduce administrative expenses while maintaining targeted levels of service and operating performance; failure by a
service provider to meet its obligations to Aetna or Humana; Aetna’s and Humana’s ability to develop and maintain
relationships (including collaborative risk-sharing agreements) with providers while taking actions to reduce medical costs and/or
expand the services each company offers; Aetna’s ability to demonstrate that Aetna’s products and processes lead to
access to quality affordable care by Aetna’s members; Aetna’s and/or Humana’s ability to maintain their relationships
with third-party brokers, consultants and agents who sell their products; increases in medical costs or Group Insurance claims
resulting from any epidemics, acts of terrorism or other extreme events; changes in medical cost estimates due to the necessary
extensive judgment that is used in the medical cost estimation process, the considerable variability inherent in such estimates,
and the sensitivity of such estimates to changes in medical claims payment patterns and changes in medical cost trends; a downgrade
in Aetna’s financial ratings; and adverse impacts from any failure to raise the U.S. Federal government’s debt ceiling
or any sustained U.S. Federal government shut down. For more discussion of important risk factors that may materially affect
Aetna, please see the risk factors contained in Aetna’s 2014 Annual Report on Form 10-K (“Aetna’s 2014 Annual
Report”) on file with the Securities and Exchange Commission (“SEC”). For more discussion of important risk
factors that may materially affect Humana, please see the risk factors contained in Humana’s 2014 Annual Report on Form
10-K (“Humana’s 2014 Annual Report”), Humana’s Quarterly Report on Form 10-Q for the quarter ended March,
31, 2015 (“Humana’s Quarterly Report on Form 10-Q”) and Humana’s Current Reports on Form 8-K filed or
furnished during 2015, each on file with the SEC. You should also read Aetna’s 2014 Annual Report and Aetna’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2015, on file with the SEC, and Aetna’s Quarterly Report on Form 10-Q
for the quarter ended June 30, 2015, when filed with the SEC, for a discussion of Aetna’s historical results of operations
and financial condition. You should also read Humana’s 2014 Annual Report and Humana’s Quarterly Report on Form 10-Q
for a discussion of Humana’s historical results of operations and financial condition.
No assurances can be given that
any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do occur, what impact
they will have on the results of operations, financial condition or cash flows of Aetna or Humana. Aetna does not assume
any duty to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, as
of any future date.
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