The board of Tenet Healthcare Corp., Dallas, has rejected the latest offer for the company by Community Health Systems, according to a Tenet news release (PDF), seemingly putting their six-month corporate control battle to an end.
Tenet rejects Community's latest offer
Tenet once again said that Community's offer, boosted last week from $6 per share to $7.25 per share, “grossly undervalues” Tenet. When Community made its revised offer last week, it set a deadline of 6 p.m. ET May 9 for Tenet to begin negotiating a deal or else the offer would be rescinded. Including the assumption of $4 billion in Tenet's debt, Community's original offer was valued at $7.3 billion and the latest offer at nearly $8.1 billion.
In a letter to Wayne Smith, chairman, president and CEO of Community, Tenet wrote: “We believe that the latest proposal fails to offer value sufficient to warrant discussions between Tenet and Community Health.”
Tenet's board also approved a $400 million stock-repurchase program, according to the release. Tenet shares opened down 13 cents, to $6.40 per share, from Friday's close. At that price, Tenet could repurchase about 62.5 million shares, or about 12.8% of the shares outstanding as of March 31. Community's shares slipped six cents at today's opening, but were trading up about 35 cents. All trading figures are from Quote.com.
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