Gentiva Health Services Inc., the home health and hospice company resisting a hostile takeover attempt from Kindred Healthcare Inc., said it was approached by another investor in the sector with a higher bid.
The alternative bidder for Gentiva said it would offer $17.25 a share in cash. Based on Gentiva’s outstanding shares of about 36.8 million, the equity value of the deal would be $634.8 million. The company’s board said it would review this new proposal, without naming the bidder.
Gentiva rose 16 percent to $17.96 at 4 p.m. in New York trading, its highest price since July 2011 and giving it a market capitalization about $662 million.
Kindred offered this week to buy a 14.9 percent stake in Gentiva after the company rebuffed two takeover bids, a change in strategy to try to force the company to enter talks. That’s the most Kindred can buy without triggering a “poison pill” takeover defense as it seeks to force a deal with Gentiva.
Kindred’s current offer “significantly undervalues Gentiva’s shares, is coercive and not in the best interests of Gentiva stockholders,” said Atlanta-based Gentiva, while recommending that shareholders reject Kindred’s offer and not tender their shares.
A Kindred spokeswoman couldn’t be immediately reached for comment.
Kindred, a long-term medical care provider based in Louisville, Kentucky, would walk away if the new proposal isn’t successful in forcing talks, said Chief Executive Officer Paul Diaz in a July 14 statement. Gentiva also turned down a June offer from Kindred of $14.50 a share for the company, valued at $573 million, and an offer of $14 a share, or about $533 million, announced May 15.