Genesis HealthCare Corp. said the most recent buyout offer from JER Partners and Formation Capital is the best it has received, but a Friedman Billings Ramsey analyst cautioned that the bidding war for the nursing center operator may continue.
On Saturday, Genesis board of directors recommended shareholders approve a $69.35-per-share offer from JER and Formation. It said the bid was superior to the last offer from Fillmore Capital Partners. The two groups have been competing for Genesis since January.
Fillmores previous bid was equal to $69.25 per Genesis share. Genesis shareholders can vote to approve it at a May 30 meeting.
JER and Formation first offered $63 per share of Kennett Square, Pa.-based Genesis.
Analyst James Kumpel raised his target price to $69.50 from $69, and reiterated a Market Perform rating, meaning he expects the stock to perform about as well as other stocks in the industry over the next year. Kumpel does not expect the share price to go much higher, but said bidding may not be done yet. The shareholder meeting is still more than a week away, so Fillmore still has time to counter this Formation-JER bid.
Genesis shares closed at $68.51 Monday. -- by the Associated Press