Kindred Healthcare, rebuffed again Monday by Gentiva Health Services' board of directors
, denied that its $14.50 per share offer undervalues the smaller home health and hospice operator.Gentiva
reiterated late Monday that its board and financial advisers believe the Atlanta-based company can create more value for shareholders as an independent entity. Moreover, it said Kindred's offer represents only a 4.7% premium to its 52-week high of $13.85.
Kindred, however, returned the swipe in a point-by-point response
Gentiva's shares, it said, reached that high prior to the Medicare rate rebasing that took a heavy-handed cut to home health payments. In addition, Kindred
said the offer values Gentiva at about 9.3 times its projected 2014 earnings before interest, taxes, depreciation and amortization, based on research analysts' estimates.
“In order to send a strong signal to the Gentiva board, Kindred continues to urge all Gentiva shareholders to tender their shares in support of its value enhancing offer,” the Louisville, Ky.-based post-acute-care company said in a news release. “If a majority of the outstanding Gentiva shares are tendered prior to July 16, 2014, Kindred intends to amend the offer to seek to purchase 14.9% of Gentiva's outstanding shares, positioning Kindred as Gentiva's largest shareholder.”
A shareholder rights plan, adopted shortly after Kindred made its hostile offer, prevents Kindred from acquiring more than a 15% stake without permission.Follow Beth Kutscher on Twitter: @MHbkutscher