Reiterates Commitment to Combination of Kindred and Gentiva to
Create Value for Both Companies’ Shareholders
LOUISVILLE, Ky.--(BUSINESS WIRE)--May 27, 2014--
Kindred Healthcare, Inc. (“Kindred” or the “Company”) (NYSE:KND) today
sent the following letter to the Gentiva Health Services, Inc.
(“Gentiva”) (NASDAQ:GTIV) Board of Directors in response to the poison
pill (also known as a “shareholder rights plan”) implemented by the
Gentiva Board and disclosed by Gentiva on Friday, May 23, 2014:
May 27, 2014
Gentiva Health Services, Inc.
Riverwood Parkway, Suite 1400
Atlanta, GA 30339
Chief Executive Officer, President and Director
Health Services, Inc.
3350 Riverwood Parkway, Suite 1400
Dear Rod and Tony:
Since the May 15, 2014 public announcement of our offer to acquire
Gentiva for total consideration of $14.00 per share, we have heard from
both companies’ shareholders – and sell-side research analysts have
reported – that they support a combination and that the price is a very
compelling and significant premium to Gentiva’s historic trading price
and projected earnings estimates. We are certain you have heard the same
from your shareholders.
We are disappointed, however, that instead of listening to your
shareholders – the true owners of Gentiva – and immediately entering
into good faith negotiations with Kindred, your Board has instead
implemented a poison pill that limits shareholders’ opportunity to
maximize the value of their investment. We question the motive and
timing of such implementation, which limits not just Kindred, but all
Gentiva shareholders from increasing their investment in the company.
Gentiva has been steadfastly unwilling to begin a dialogue with Kindred,
and we believe the implementation of a poison pill further demonstrates
that Gentiva is ignoring the will of its shareholders. As you know, our
offer represents a 64% premium to Gentiva’s share price on May 14, 2014
(the day prior to Kindred making public the offer) and a 40% premium to
Wall Street analysts’ one-year median price target of $10.00 per share.
We urge the Gentiva Board to stop erecting obstacles and to immediately
engage with our Board and management team to reach agreement on this
value creating transaction.
Despite Gentiva’s actions, we will not be deterred. We are determined to
pursue the proposed combination of Kindred and Gentiva and are committed
over the long-term to achieving our objective. We are ready, willing and
able to quickly proceed toward consummating a negotiated transaction.
Paul J. Diaz
Chief Executive Officer
Kindred Healthcare, Inc.
cc: Phyllis R. Yale, Chair of the Board
Citi is acting as financial advisor to Kindred and Cleary Gottlieb Steen
& Hamilton LLP is acting as legal advisor. Gibson, Dunn & Crutcher LLP
is serving as special counsel to Kindred.
This press release includes forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements include, but are not limited to, statements regarding the
Company’s proposed business combination transaction with Gentiva
(including financing of the proposed transaction and the benefits,
results, effects and timing of a transaction), all statements regarding
the Company’s (and the Company and Gentiva’s combined) expected future
financial position, results of operations, cash flows, dividends,
financing plans, business strategy, budgets, capital expenditures,
competitive positions, growth opportunities, plans and objectives of
management, and statements containing the words such as “anticipate,”
“approximate,” “believe,” “plan,” “estimate,” “expect,” “project,”
“could,” “would,” “should,” “will,” “intend,” “may,” “potential,”
“upside,” and other similar expressions. Statements in this press
release concerning the business outlook or future economic performance,
anticipated profitability, revenues, expenses, dividends or other
financial items, and product or services line growth of the Company (and
the combined businesses of the Company and Gentiva), together with other
statements that are not historical facts, are forward-looking statements
that are estimates reflecting the best judgment of the Company based
upon currently available information.
Such forward-looking statements are inherently uncertain, and
stockholders and other potential investors must recognize that actual
results may differ materially from the Company’s expectations as a
result of a variety of factors, including, without limitation, those
discussed below. Such forward-looking statements are based upon
management’s current expectations and include known and unknown risks,
uncertainties and other factors, many of which the Company is unable to
predict or control, that may cause the Company’s actual results,
performance or plans with respect to Gentiva, to differ materially from
any future results, performance or plans expressed or implied by such
forward-looking statements. These statements involve risks,
uncertainties and other factors discussed below and detailed from time
to time in the Company’s filings with the Securities and Exchange
Commission (the “SEC”).
Risks and uncertainties related to the proposed transaction with Gentiva
include, but are not limited to, uncertainty as to whether the Company
will further pursue, enter into or consummate the transaction on the
terms set forth in the proposal or on other terms, potential adverse
reactions or changes to business relationships resulting from the
announcement or completion of the transaction, uncertainties as to the
timing of the transaction, adverse effects on the Company’s stock price
resulting from the announcement or consummation of the transaction or
any failure to complete the transaction, competitive responses to the
announcement or consummation of the transaction, the risk that
regulatory, licensure or other approvals and financing required for the
consummation of the transaction are not obtained or are obtained subject
to terms and conditions that are not anticipated, costs and difficulties
related to the integration of Gentiva’s businesses and operations with
the Company’s businesses and operations, the inability to obtain, or
delays in obtaining, cost savings and synergies from the transaction,
unexpected costs, liabilities, charges or expenses resulting from the
transaction, litigation relating to the transaction, the inability to
retain key personnel, and any changes in general economic and/or
industry specific conditions.
In addition to the factors set forth above, other factors that may
affect the Company’s plans, results or stock price are set forth in the
Company’s Annual Report on Form 10-K and in its reports on Forms 10-Q
Many of these factors are beyond the Company’s control. The Company
cautions investors that any forward-looking statements made by the
Company are not guarantees of future performance. The Company disclaims
any obligation to update any such factors or to announce publicly the
results of any revisions to any of the forward-looking statements to
reflect future events or developments.
This press release is provided for informational purposes only and does
not constitute an offer to purchase or the solicitation of an offer to
sell any securities. Subject to future developments, Kindred may file a
registration statement and/or tender offer documents with the SEC in
connection with a possible business combination transaction with
Gentiva. Kindred and Gentiva shareholders should read those filings, and
any other filings made by Kindred with the SEC in connection with a
possible business combination, if any, as they will contain important
information. Those documents, if and when filed, as well as Kindred
other public filings with the SEC, may be obtained without charge at the
SEC’s website at www.sec.gov
and at Kindred’s website at www.kindredhealthcare.com.
About Kindred Healthcare
Kindred Healthcare, Inc., a top-150 private employer in the United
States, is a FORTUNE 500 healthcare services company based in
Louisville, Kentucky with annual revenues of $5 billion and
approximately 63,000 employees in 47 states. At March 31, 2014, Kindred
through its subsidiaries provided healthcare services in 2,313
locations, including 100 transitional care hospitals, five inpatient
rehabilitation hospitals, 99 nursing centers, 22 sub-acute units, 157
Kindred at Home hospice, home health and non-medical home care
locations, 105 inpatient rehabilitation units (hospital-based) and a
contract rehabilitation services business, RehabCare, which served 1,825
non-affiliated facilities. Ranked as one of Fortune magazine’s Most
Admired Healthcare Companies for six years in a row, Kindred’s mission
is to promote healing, provide hope, preserve dignity and produce value
for each patient, resident, family member, customer, employee and
shareholder we serve. For more information, go to www.kindredhealthcare.com.
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Source: Kindred Healthcare, Inc.
Kindred Healthcare, Inc.
Senior Vice President, Marketing and
Joele Frank, Wilkinson Brimmer Katcher
Brimmer or Andrew Siegel
Kindred Healthcare, Inc.
Senior Vice President, Tax and Treasurer
King & Co., Inc.
Jordan Kovler, 212-493-6990