UPDATE 1-Express Scripts, Medco cut merger termination fee

Tue Nov 8, 2011 7:39am EST

* Cuts termination fee on deal to $650 mln from $950 mln

* Keeps termination fee at $950 mln if either co changes recommendation on merger

Nov 8 (Reuters) - Express Scripts Inc said it agreed to cut the termination fee on its pending $29 billion takeover of Medco Health Solutions Inc .

In a regulatory filing on Tuesday, Express Scripts said the companies agreed to reduce the termination fee on the deal to $650 million. However, if either company changes its recommendation on the merger, the termination fee would still be $950 million.

In July, both companies signed the biggest ever deal in the healthcare services industry to create a pharmacy benefits nmanager that has access to nearly one-third of the entire American market.

Shares of Express Scripts had closed at $47.09 Monday on Nasdaq, while Medco shares closed at $57.11 on the New York Stock Exchange.

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