Kindred urges Gentiva shareholders to accept bid

Associated Press |

LOUISVILLE, Ky. (AP) — Kindred Healthcare is urging Gentiva Health Services shareholders to support Kindred's latest acquisition bid, which faces opposition from both Gentiva's board and an anti-takeover measure the health and hospice service provider adopted last month.

Kindred Healthcare Inc., which runs nursing and rehabilitation centers, said Tuesday its all-cash offer of $14.50 per share provides immediate and certain value to Gentiva shareholders. That $573 million bid represents an increase from an offer totaling $533 million, or $14 per share in cash and stock, that Kindred announced in May.

Gentiva Health Services Inc. had rejected the previous bid and adopted a shareholder rights plan, or "poison pill" measure, that limits shareholders from acquiring more than a 15 percent stake. On Monday, Gentiva rejected the improved offer as well, saying it significantly undervalued the company and was opportunistic because it exploits a temporary decrease in Gentiva's stock price.

Kindred on Tuesday said that all Gentiva stock owners should send a "strong signal" to Gentiva's board by tendering their shares in support of the increased offer. If a majority of Gentiva's shares are tendered, Kindred said it expects to amend the offer to purchase 14.9 percent of Gentiva's shares, a move that would make it the largest shareholder and avoid triggering the poison pill measure.

A Kindred spokeswoman said the company currently owns only a "small number" of Gentiva shares.

Kindred is based in Louisville, Kentucky, and Gentiva is headquartered in Atlanta.

Shares of Kindred climbed 10 cents to $23.20 in Tuesday afternoon trading, while Gentiva rose nearly 3 percent, or 43 cents, to $15.49. Meanwhile, the Nasdaq composite was up about 1 percent.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


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