Signify Health Faces $50 Million Suit Over $250 Million Deal (1)

Signify Health Inc. is facing litigation in Delaware over claims it rushed to integrate a $250 million purchase, Caravan Health Inc., to avoid making $50 million in additional post-deal payments tied to the acquired business.

The lawsuit, filed in the state’s Chancery Court, accuses Signify of prematurely consolidating its operations last year with those of Caravan, a population health management company, in breach of merger agreement clauses requiring it to wait until 2023.

The aim of those provisions was to ensure Signify refrained from “diverting key members of its workforce away from their Caravan-related duties” as a way of intentionally ...