Shares of Cigna and Humana slid Wednesday after a report that the two health-care giants are in talks to merge.
A Cigna spokesperson did not immediately respond to CNBC's request for comment on the report from The Wall Street Journal, which cited people familiar with the matter. A Humana spokesperson declined to comment.
The companies are discussing a stock-and-cash deal that could be finalized by the end of this year, the people told the Journal.
A merger would be a mega deal. Cigna's market value sat at roughly $77 billion on Wednesday and Humana's was nearly $60 billion, making them two of the nation's largest health insurers.
Shares of Cigna closed 8% lower Wednesday, while Humana's stock closed more than 5% lower.
The rumored deal comes after reports earlier this month that Cigna was exploring a sale of its Medicare Advantage business, which manages government health insurance for people age 65 and older. A Cigna spokesperson at the time said the company does not comment on "rumors or speculation."
Some analysts have suggested that a potential combination with Humana could be a reason for Cigna to offload its Medicare Advantage business. Doing away with that business could potentially temper antitrust concerns for such a merger, Scott Fidel, health care stock analyst at Stephens, wrote in a note earlier this month, according to STAT News.
"We would see this action being one component of a potential pursuit of Humana as an acquisition target, with the divestiture being a proactive move to reduce antitrust risk," Fidel said.
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