Value Health shareholders are expected to approve the company's purchase by Columbia/HCA Healthcare Corp. at a special meeting outside Hartford, Conn., this week.
Originally announced as a stock- swap merger, the deal was restructured in April as an all-cash deal valued at $1.1 billion after Columbia's stock price slid following the federal government's raid on the company's El Paso, Texas, operations.
According to the proxy statement sent to Value Health shareholders, in early April Columbia Chairman and Chief Executive Officer Richard Scott suggested reworking the deal as a cash purchase so the Nashville-based hospital chain "could undertake a significant share repurchase."
In April, Columbia said it would buy back as much as $1 billion, or about 5%, of its outstanding common shares.
The Value Health proxy gives details of lucrative consulting and noncompete agreements with key Value Health executives.
The company has agreed to pay founder Robert E. Patricelli, who is chairman, president and CEO, $4.5 million under a one-year consulting contract and three-year noncompete agreement. Under similar terms, Steven J. Shulman, formerly president of Value Health's pharmacy and disease management group, would pocket $3 million.
Shulman left Value Health in March to become president and CEO of Roseland, N.J.-based Prudential Healthcare.
Both Columbia and Value Health expect the deal to close by the end of the month, assuming a majority vote by Value Health's 3,105 shareholders of their 55 million outstanding shares.
The Federal Trade Commission antitrust review period expired in February without comment.