Gentiva Health Services, which repeatedly has been turning aside takeover overtures from Kindred Healthcare, has decided to open its books to Kindred and a rival unnamed suitor courting the home health and hospice operator with $17.25 per share offers.
The Atlanta-based company is being pursued by Kindred Healthcare and a second mystery bidder. The latter firm has entered into a nondisclosure agreement that will allow it to conduct due diligence, according to a Gentiva release late Thursday.
Gentiva said it will also allow Kindred to have equal access to its financials on the condition that the post-acute-care operator drops its tender offer for a 14.9% stake in Gentiva. Gentiva also said its board will review both proposals.
Kindred, whose three earlier offers have been rebuffed by Gentiva's board, launched its tender offer last month, hoping to appeal directly to shareholders. It is currently in the midst of a $16 per share tender offer for Gentiva shares that expires July 28.
But Gentiva has insisted that Kindred was undervaluing the company, and revealed on July 17 it had received a $17.25 per share offer from an undisclosed party, described only as a “recognized owner, operator and investor.”
The disclosure prompted Kindred—which had said it didn't intend to go higher than $16 per share—to change course and agree to meet the higher offer. But it asked to conduct due diligence to make sure a higher price tag is warranted.
Analysts have said the second suitor is likely one of four private-equity firms: Cressey & Co., Formation Capital, GTCR and Kohlberg Kravis Roberts & Co. All meet the criteria Gentiva outlined for its unknown suitor. KKR owned 2.41% of Gentiva stock as of March 31, 2014, according to a Yahoo Finance listing of Gentiva's top institutional investors.
Follow Beth Kutscher on Twitter: @MHbkutscher
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