M&Ain't: Several Of The Year's Biggest Mergers Face Uncertain Future - CVS Health (NYSE:CVS), AT&T (NYSE:T)

Some of the most prominent and anticipated mergers of the year appear to be in a holding pattern, and the trend is nothing new.

The failure rate of mergers and acquisitions teeters between 70 and 90 percent, according to the 2011 Harvard Business Review study.

The high failure rate is a direct result of companies' inability to determine the strategic purpose of deals and how specific plans will enhance or stunt growth, according to the Harvard study.

AT&T/Time Warner Inc.

AT&T Inc. T’s $85-billion acquisition of Time Warner Inc. faced significant headwinds earlier this year as the Justice Department sued to block the potential merger.

The reasoning for the DOJ’s decision was rooted in the deal's effect on consumers. The government said the merger would add more weight in the market and create higher prices for distributors, resulting in a rise in cable and satellite TV bills.

The six-week trial, chock full of strong presidential opinions, ended June 12 when Judge Richard Leon ruled that the government failed to prove the deal violates antitrust law. The deal is one of the largest in media history.

A month later, the DOJ appealed Leon’s decision allowing the merger. In order to expedite the process, final briefs in the appeals case are due by October.

CVS Health/Aetna

Last year, CVS Health Corp CVS announced plans to acquire Aetna, Inc. AET as a way to reduce costs and improve healthcare access. Almost a year later, the American Medical Association urged the Justice Department to oppose and block the merger.

The AMA sent a letter to the DOJ expressing concern that market concentration is responsible for high health care costs, stating that the merger would weaken competition at patients expense. The AMA also stressed the merger could affect Medicare Part D, pharmacy manager services, local health insurance and local retail pharmacies.

Since the initial opposition, both the California Medical Association and the California Department of Insurance have taken to similar viewpoints. California Department of Insurance Commissioner Dave Jones submitted a 15-page statement regarding further opposition to the merger.

“Commissioner Jones extensively cited evidence presented by the AMA and prominent experts in antitrust law, economics and health policy demonstrating that there are no potential benefits of sufficient magnitude and certainty that would outweigh the anticompetitive effects of the proposed merger,” AMA President Barbara McAneny said in an Aug. 1 press release.

This merger is awaiting DOJ approval.

Cigna/Express Scripts

In March, Cigna Corporation CI announced plans to acquire Express Scripts Holding Co. ESRX. The extensive $52-$54 billion cash-and-stock deal would have had Cigna pay 30 percent to gain control of Express Scripts’ shares.

In response, billionaire investor Carl Icahn opposed the merger and urged shareholders to vote against the proposal, stating that “Cigna is dramatically overpaying for a highly challenged Express Scripts that is facing existential risks on several fronts."

Icahn, who owns a 0.56-percent stake in Cigna, identified numerous headwinds to the deal and said competition from Amazon.com AMZN, as well as regulatory changes to the rebate system, would likely affect profitability.

As expected, the company didn't react well to Icahn’s strong opinions and issued a press release disputing his comments.

"Mr. Icahn, on the other hand, has made a speculative financial bet against the transaction in the hopes that he can create a gain at the expense of Cigna and Express Scripts shareholders. Mr. Icahn's opposition is misguided and short-sighted," Cigna said in a statement. On Aug. 13, Icahn backed down and will no longer solicit votes to block the merger.

Shareholders vote on the merger Aug. 24.

Rite Aid/Albertsons

In February, Albertsons announced plans to purchase part of Rite Aid Corporation RAD in a cash-and-stock deal. The expectation was that the deal would allow for the company to go public, with Albertsons investors receiving 71 percent of the combined company.

The evening before the shareholder meeting in August, Rite Aid released a statement announcing the termination of the deal.

"While we believed in the merits of the combination with Albertsons, we have heard the views expressed by our stockholders and are committed to moving forward and executing our strategic plan as a standalone company," said Rite Aid Chairman and CEO John Standley.

This termination wasn't totally unexpected: the deal faced opposition from critics who contended that Albertsons would be given a simple route to becoming public without providing any benefit to Rite Aid shareholders.