Kindred Has the Resources to Fund an
All-Cash Transaction; Stands Ready to Execute Confidentiality,
Standstill, and Definitive Merger Agreements with Gentiva
Kindred Healthcare, Inc. (“Kindred”) (NYSE:KND) today reiterated
its commitment to its proposed combination with Gentiva Health
Services, Inc. (“Gentiva”) (NASDAQ:GTIV).
As previously announced on July 21, 2014, Kindred is willing to
enter into a negotiated agreement to acquire all of the outstanding
shares of Gentiva for $17.25 per share in cash, subject to due
diligence. Kindred is also prepared to enter into appropriate
confidentiality and standstill agreements in order to facilitate
discussions.
Kindred believes that the value Gentiva shareholders would
receive through a combination with Kindred is superior to what
Gentiva could create on a standalone basis or through a transaction
with any third party. Among other things, Kindred noted the
following:
- Kindred is willing and able to
quickly execute an all-cash transaction with no financing
contingency at $17.25 per share. Kindred has the resources to
fund an all-cash transaction. Citigroup has delivered a “highly
confident letter” indicating that it is highly confident in its
ability to arrange financing for such a transaction subject to the
terms and conditions set forth therein. At the time of signing a
definitive acquisition agreement, Kindred intends to have bank
commitment letters in place, and any such agreement will not
contain a financing condition. In addition, Kindred’s recently
completed $221 million equity offering is a further indication of
Kindred’s ability to move forward quickly with an all-cash
transaction.
- In addition to offering Gentiva
shareholders an all-cash consideration, Kindred is willing to work
with Gentiva to structure a transaction under which Gentiva
shareholders could elect to receive a mix of cash and stock,
enabling them to participate in the significant upside potential of
the combined company. Kindred expects to achieve at least $60
million to $80 million in operating and financial synergies in the
first two years of a combination, with $40 million expected in the
first year alone. While Kindred is fully prepared to pay all cash,
many Gentiva shareholders have indicated their preference for a
transaction structure that would provide them with the option to
receive equity in the combined company. Given Kindred’s standalone
prospects, as well as the benefits of the proposed combination,
Kindred believes that a cash and stock transaction would deliver
greater value to Gentiva shareholders than cash alone.
- A transaction with Kindred would
deliver more value to Gentiva shareholders than any other
alternative. Given that Kindred and Gentiva have complementary
assets and geographic footprints, Kindred believes it could realize
more synergies than any other strategic bidder. In addition,
Kindred believes that the sale of Gentiva for $17.25 per share will
deliver far greater value to Gentiva shareholders than the
continued execution of Gentiva’s standalone plan. Accordingly,
Kindred expects that, with due diligence, it will be best
positioned to provide the greatest value to Gentiva
shareholders.
- Kindred has already received
antitrust approval for its proposed combination with Gentiva.
On July 22, 2014, the Federal Trade Commission granted termination
of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976. Furthermore, Kindred believes that the
proposed combination poses minimal execution risk given the Kindred
management team’s extensive experience and success in integrating
acquisitions.
Paul J. Diaz, Chief Executive Officer of Kindred, commented, “We
are as committed as ever to reaching agreement on a value-creating
combination of Kindred and Gentiva, and we stand ready to quickly
execute an all-cash transaction with no financing condition.”
Mr. Diaz added, “We are eager to work with Gentiva, and look
forward to entering into appropriate confidentiality and standstill
agreements so that we can start the due diligence process. We are
confident that constructive dialogue between our two companies will
allow us to deliver the value inherent in the proposed combination
to our respective shareholder groups, as well as our patients and
employees.”
Citigroup is acting as financial advisor to Kindred. Cleary
Gottlieb Steen & Hamilton LLP is acting as legal advisor and
Gibson, Dunn & Crutcher LLP is serving as special counsel to
Kindred.
Forward-Looking
Statements
This press release includes forward-looking statements,
including, but not limited to, statements regarding Kindred’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
Kindred’s (and Kindred 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 Kindred (and the combined businesses of
Kindred and Gentiva), together with other statements that are not
historical facts, are forward-looking statements that are estimates
reflecting the best judgment of Kindred 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 Kindred’s expectations as
a result of a variety of factors, including, without limitation,
those discussed below, set forth in Kindred’s Annual Report on Form
10-K and in its reports on Forms 10-Q and 8-K. Such forward-looking
statements are based upon management’s current expectations and
include known and unknown risks, uncertainties and other factors,
many of which Kindred is unable to predict or control, that may
cause Kindred’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 Kindred’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
Kindred will further pursue, enter into or consummate any
transaction on the proposed terms or on other terms, potential
adverse reactions or changes to business relationships resulting
from the announcement or completion of any transaction,
uncertainties as to the timing of any transaction, adverse effects
on Kindred’s stock price resulting from the announcement or
consummation of any transaction or any failure to complete any
transaction, competitive responses to the announcement or
consummation of any transaction, the risk that regulatory,
licensure or other approvals and financing required for the
consummation of any 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 Kindred’s businesses and operations, the inability
to obtain, or delays in obtaining, cost savings and synergies from
any transaction, uncertainties as to whether the consummation of
any transaction will have the accretive effect on our earnings or
cash flows that we expect, unexpected costs, liabilities, charges
or expenses resulting from any transaction, litigation relating to
any transaction, the inability to retain key personnel, and any
changes in general economic and/or industry-specific
conditions.
Many of these factors are beyond Kindred’s control. Kindred
cautions investors that any forward-looking statements made by
Kindred are not guarantees of future performance. Kindred 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.
Additional Information
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 of Gentiva. 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 June 30, 2014,
Kindred through its subsidiaries provided healthcare services in
2,353 locations, including 97 transitional care hospitals, five
inpatient rehabilitation hospitals, 98 nursing centers, 21
sub-acute units, 153 Kindred at Home hospice, home health and
non-medical home care locations, 104 inpatient rehabilitation units
(hospital-based) and a contract rehabilitation services business,
RehabCare, which served 1,875 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.
MediaKindred Healthcare,
Inc.Susan Moss, 502-596-7296Senior Vice President, Marketing and
CommunicationsorJoele Frank, Wilkinson Brimmer KatcherAndy Brimmer
/ Andrew Siegel, 212-355-4449orInvestors
and AnalystsKindred Healthcare, Inc.Stephen Farber,
502-596-2525Executive Vice President, Chief Financial OfficerorD.F.
King & Co., Inc.Jordan Kovler / Kristian Klein212-493-6990 /
212-232-2247
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