Tenet Healthcare Corp., Dallas, filed a motion to begin discovery in its federal lawsuit against Community Health Systems, outlining the documents that Tenet contends shareholders need to see in order to make a decision on Community's bid to buy Tenet, according to a securities filing.
Tenet seeks Community Health documents
Also today, Community raised its offer to $7.25 a share, all in cash, to acquire Tenet. Along with the assumption of $4 billion in Tenet debt, the offer is valued in total at nearly $8.1 billion.
Tenet's filing, made in the case it filed April 11 in U.S. District Court in Dallas, seeks a broad range of documents from Franklin, Tenn.-based Community. These include documents related to: Community's admissions criteria handbook, known as the Blue Book; its use of software by Pro-MED Clinical Systems, including whether any Community executives or their immediate family members have ever had a financial interest in Pro-MED; agendas or reports of weekly divisional conference calls that referenced rates of admissions, especially admissions from the emergency department, from 2006 onward; more information on various government investigations; and Community's communications with the U.S. Securities and Exchange Commission, investors and journalists related to the offer to buy Tenet.
Tenet's motion argues that the court should compel Community to make these disclosures on an expedited schedule to allow the court to consider the issues in the case in time for Tenet's Nov. 3 shareholders meeting. Community has announced its intention to nominate directors for election to Tenet's board at that meeting.
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