Last week, the board of Naples, Fla.-based Health Management Associates ratified a shareholder rights plan to protect itself from its largest shareholder, New York City-based hedge fund Glenview Capital Management, but Glenview Capital executives do not expect to take over the for-profit hospital company, according to Dow Jones report.
A shareholder rights plan, known in the business world as a "poison pill," is a tactic used by publicly held companies to protect themselves from a possible takeover of a large shareholder. In a May 6 filing, Glenview announced it owned approximately 37.8 million shares, or 14.6 percent, of Health Management's stock. In addition, Glenview said it may increase its ownership of Health Management even further, which could potentially result in a takeover.
Under Health Management's one-year shareholder rights plan, other shareholders would be protected from any possible takeover by Glenview if the hedge fund's ownership stake reaches 15 percent or higher. Health Management executives said it adopted the plan to "help promote fair and equal treatment of all stockholders of the corporation (not just Glenview) and ensures that the board of directors remains in the best position to discharge its fiduciary duties."
According to the Dow Jones report, Glenview executives clarified that "Glenview has made no proposals, either to HMA or to any of its holdings over a 13-year period, which are to the exclusive benefit of Glenview."
A shareholder rights plan, known in the business world as a "poison pill," is a tactic used by publicly held companies to protect themselves from a possible takeover of a large shareholder. In a May 6 filing, Glenview announced it owned approximately 37.8 million shares, or 14.6 percent, of Health Management's stock. In addition, Glenview said it may increase its ownership of Health Management even further, which could potentially result in a takeover.
Under Health Management's one-year shareholder rights plan, other shareholders would be protected from any possible takeover by Glenview if the hedge fund's ownership stake reaches 15 percent or higher. Health Management executives said it adopted the plan to "help promote fair and equal treatment of all stockholders of the corporation (not just Glenview) and ensures that the board of directors remains in the best position to discharge its fiduciary duties."
According to the Dow Jones report, Glenview executives clarified that "Glenview has made no proposals, either to HMA or to any of its holdings over a 13-year period, which are to the exclusive benefit of Glenview."
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