Seniors Housing Weekly Update - Hostile Takeovers In Vogue

May 27, 2014

 

May 27, 2014. 60 Seconds with Steve Monroe. Two hostile takeover attempts in deals worth more than $1 billion, but only one has a chance to close.

Hostile Takeovers In Vogue

These days, we don’t often see hostile takeover attempts, unlike the 1980s when CEOs would get the 5 pm Friday call that another company had purchased a block of shares, telling the stunned CEO, “we want to buy you.” It also did not happen much in the health care space. But this month we have seen Pfizer make several unsolicited offers for AstraZeneca, all rejected and now withdrawn, in what would have been a deal valued well over $100 billion. And Kindred Healthcare jumped in a few weeks ago with its own unsolicited bid for home health and hospice provider Gentiva Health Services, in a deal valued at more than $1.6 billion including assumed debt. This was also rejected, but with the substantial premium and prospects for Gentiva’s shareholders not quite the same as for AstraZeneca, we think Gentiva’s board will eventually cave. The deal certainly gives Kindred some home health and hospice bulk, but at what price, especially if they have to increase the offer to get the deal done? But will this be the last big one before Paul Diaz retires? We will see. 

 

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