On Thursday, Dec. 9, Franklin, Tenn.-based Community Health Systems offered an unsolicited $3.3 billion bid for Dallas-based Tenet Healthcare in an effort to become the largest hospital operator in the country. Read the developments of the bid, from its initial offering to the lawsuits now being filed by shareholders.
Dec. 9: CHS Offers $3.3B Bid for Tenet
CHS offered $6 per share for its rival, when Tenet's stock had recently closed at $4.29 per share. CHS would also assume Tenet's roughly $4 billion in debt.
Dec. 10: Tenet Rejects $3.3B Bid From CHS
Tenet Healthcare rejected the $3.3 billion offer from CHS, calling the highly leveraged proposal "inadequate." The offer, which would include $4 billion in net debt for a total value of $7.3 billion, is "not in the best interests of Tenet or its shareholders," Tenet said in a news release. Also, the Tenet board "has serious concerns about Community Health’s ability to integrate and operate a business like Tenet," according to the release.
Dec. 14: CHS's Bid to Buy Tenet May Not be Over
Tenet said the $7.3 billion offer was not "even remotely fair value," but CHS might well raise its offer, in which case shareholders would be tempted to accept the deal, said Jason Gurda, an analyst with Leerink Swann Healthcare Equity Research. CHS's offer comes to about $6 per share, but the company has the resources to raise its offer to a little more than $7 a share, he said.
Dec. 17: CHS Still Committed to Acquiring Tenet
Wayne Smith, chairman of CHS, said the company remains "absolutely committed" to acquiring Tenet.
Dec. 21: CHS Prepares For Hostile Takeover of Tenet
CHS is preparing for a hostile takeover of Tenet in response to the Tenet board's rejection of its $7.3 billion offer. With all 10 members of Tenet's board up for re-election at the company's 2011 shareholders meeting, as yet unscheduled, Franklin, Tenn.-based CHS is compiling its own slate of Tenet board nominees.
Dec. 22: Shareholder Files Suit Against Tenet for Rejecting CHS Offer
A shareholder filed a lawsuit against Tenet for refusing a $7.3 billion offer by CHS to buy the system. The lawsuit, filed by shareholder Max Katz both individually and on behalf of other shareholders, alleges Tenet board members breached their fiduciary obligations to shareholders by rejecting the offer and not exploring other opportunities with the suitor.
Read more about Tenet or Community Health:
- Tenet Announces 3Q Results, Net Profit of $932M
- Colorado's Memorial Health System Approached by HCA, but Still Likely to Convert to Non-Profit
- CHS Withdraws Offer for North Carolina's Beaufort Regional
Dec. 9: CHS Offers $3.3B Bid for Tenet
CHS offered $6 per share for its rival, when Tenet's stock had recently closed at $4.29 per share. CHS would also assume Tenet's roughly $4 billion in debt.
Dec. 10: Tenet Rejects $3.3B Bid From CHS
Tenet Healthcare rejected the $3.3 billion offer from CHS, calling the highly leveraged proposal "inadequate." The offer, which would include $4 billion in net debt for a total value of $7.3 billion, is "not in the best interests of Tenet or its shareholders," Tenet said in a news release. Also, the Tenet board "has serious concerns about Community Health’s ability to integrate and operate a business like Tenet," according to the release.
Dec. 14: CHS's Bid to Buy Tenet May Not be Over
Tenet said the $7.3 billion offer was not "even remotely fair value," but CHS might well raise its offer, in which case shareholders would be tempted to accept the deal, said Jason Gurda, an analyst with Leerink Swann Healthcare Equity Research. CHS's offer comes to about $6 per share, but the company has the resources to raise its offer to a little more than $7 a share, he said.
Dec. 17: CHS Still Committed to Acquiring Tenet
Wayne Smith, chairman of CHS, said the company remains "absolutely committed" to acquiring Tenet.
Dec. 21: CHS Prepares For Hostile Takeover of Tenet
CHS is preparing for a hostile takeover of Tenet in response to the Tenet board's rejection of its $7.3 billion offer. With all 10 members of Tenet's board up for re-election at the company's 2011 shareholders meeting, as yet unscheduled, Franklin, Tenn.-based CHS is compiling its own slate of Tenet board nominees.
Dec. 22: Shareholder Files Suit Against Tenet for Rejecting CHS Offer
A shareholder filed a lawsuit against Tenet for refusing a $7.3 billion offer by CHS to buy the system. The lawsuit, filed by shareholder Max Katz both individually and on behalf of other shareholders, alleges Tenet board members breached their fiduciary obligations to shareholders by rejecting the offer and not exploring other opportunities with the suitor.
Read more about Tenet or Community Health:
- Tenet Announces 3Q Results, Net Profit of $932M
- Colorado's Memorial Health System Approached by HCA, but Still Likely to Convert to Non-Profit
- CHS Withdraws Offer for North Carolina's Beaufort Regional