The company determined that providing managed-care services to the workers' compensation insurance market "is not core to our strategic direction," said Amy Turkington, a spokeswoman for Cigna (NYSE: CI | PowerRating).

Genex will acquire International Rehabilitation Associates Inc., a unit of the Philadelphia-based Cigna, which will receive Genex stock for the sale. The amount of the transaction was not disclosed.

When the deal closes, the Genex and Intracorp businesses combined will represent the industry's largest workers' compensation and disability field case management network, the companies said.

The Wayne, Pa.-based Genex provides insurers, employers and third-party administrators with managed care and information management services through its 2,000 employees and more than 100 locations throughout North America.

The Philadelphia-based Cigna is the fourth-largest U.S. health insurer by enrollment. About 80% of its U.S. health business is providing administrative services only to large employers that self-fund their employees' health benefits (BestWire, May 25, 2010).

Cigna said it will continue to offer wellness programs to employers through Intracorp under the CareAllies brand, as well as to Taft-Hartley funds, federal plans and other plan sponsors.

The transaction is expected to close within the next several weeks. Cigna plans to remain a minority shareholder of Genex. The merged business will be led by Peter Madeja, Genex's chief executive officer.

Genex Services Inc. was previously a subsidiary of disability insurer Unum Group (NYSE: UNM). In 2007, Unum Group said it completed the sale of Genex Services to Trident IV, a fund managed by Stone Point Capital, a Greenwich, Conn.-based private equity firm. Financial terms weren't disclosed (BestWire, March 5, 2007).

On the morning of Nov. 8, Cigna's stock was trading at $37.10, down 0.7% from the previous close.

Connecticut General Life Insurance Co., a member of Cigna Group, currently has a Best's Financial Strength Rating of A (Excellent).

(By Fran Matso Lysiak, senior associate editor, BestWeek: fran.lysiak@ambest.com)