Gentiva Health Services has adopted a shareholder rights plan to fend off Kindred Healthcare's $1.6 billion hostile takeover attempt.
The Atlanta-based home health and hospice operator last week rejected the unwanted offer from the larger company.
Gentiva's rights plan allows current Gentiva shareholders to acquire company shares at a discounted price if any individual group attempts to acquire more than 15% of its common stock in an unapproved transaction. The restriction expires May 20, 2015.
Shareholders will receive a dividend of one right per share on June 3.
Kindred's offer represents a 64% premium to Gentiva's pre-offer share price and aims to build size and scale as the Louisville, Ky.-based provider transitions away from skilled nursing and increases its presence in home health and rehabilitation. The post-acute-care sector has struggled over the past several quarters with volume and reimbursement pressures.
Analysts believe the deal offers a fair price for Gentiva and that shareholders may pressure management to accept a takeover. The company's shares have been hovering just below the $14 per share offer price, closing Friday at $13.68.
Follow Beth Kutscher on Twitter: @MHbkutscher
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