Kin­dred Health­care’s bid for Gen­tiva ex­pires Wed­nes­day

Modern Healthcare - - THE WEEK AHEAD - —Beth Kutscher

The suc­cess of Kin­dred Health­care’s con­tentious ten­der of­fer for shares of Gen­tiva Health Ser­vices could be re­vealed as soon as the of­fer ex­pires Wed­nes­day.

The Louisville, Ky.-based posta­cute-care op­er­a­tor has taken its bid for a re­luc­tant Gen­tiva di­rectly to the com­pany’s share­hold­ers, of­fer­ing $14.50 per share. If a ma­jor­ity of shares are ten­dered, Kin­dred will buy a 14.9% stake in the At­lanta-based home health and hospice op­er­a­tor.

That stake is the max­i­mum Kin­dred can ac­quire be­fore run­ning into Gen­tiva’s poi­son pill, put in place to thwart the hos­tile takeover.

Gen­tiva’s board and fi­nan­cial ad­vis­ers have twice re­jected Kin­dred’s of­fer. Gen­tiva last week re­leased a pre­view of its sec­ond-quar­ter fi­nan­cial re­sults, hop­ing to sway in­vestors to stay the course. It high­lighted ad­justed earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­za­tion that are ex­pected to in­crease 33% over the same pe­riod last year. Rev­enue is ex­pected to in­crease nearly 20% year over year.

In an in­vestor pre­sen­ta­tion, Gen­tiva ar­gued that there is even more of an upside to be gained as it in­te­grates last year’s ac­qui­si­tion of Harden Health­care, a deal that closed in Oc­to­ber. It’s also un­der­tak­ing a re­struc­tur­ing ini­tia­tive called One Gen­tiva.

Gen­tiva’s shares have traded above the ten­der of­fer price since it was an­nounced June 16. They closed Fri­day at $15.82.

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