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Neil_Anderson

 
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  • Hospital Consolidation Continues - Community Health Systems Acquires Health Management Associates [View article]
    To The Value Investor

    You never mentioned the $6 billion raging elephant in the room. How could you miss it?

    The $6 billion hedge fund, Glenview Capital Management, thinks the $10.50 cash and .0694 shares of CVH is way too low. They own 14.6% of HMA stock ... so, if you're correct that 70% of stockholders is required, then Glenview has nearly half the required votes needed to defeat the sale of HMA to Community Health (http://bit.ly/18XNWXh).

    Glenview has started a proxy fight to remove HMA's entire Board of Directors and replace them with a new Board of Directors. They have a website, revitalizeHMA.com. Dissatisfied shareholders (i.e. dissenters) have until Aug 19, 2013 to "consent" to Glenview's new Board in a special proxy sent to shareholders by Glenview.

    HMA has sent a (defensive) "consent revocation" proxy to all shareholders. I'm guessing that HMA is counting on lots of dissenters ignoring HMA's revocation proxy, and by doing so, their proxy will be counted in HMA's favor, which revokes the consent to the new Board. Which means they will not be counted as dissenters. Very tricky.

    So, if you're a dissenter (i.e., you want side with Glenview and replace the Board) then you better find HMA's "consent revocation proxy" and vote "No, Do not Revoke My consent". (And to be a dissenter, you also have to send-in Glenview's proxy. That's two proxies, one from Glenview, and one from HMA and both must be sent in or you will not be counted as a dissenter, like Glenview.) (I'm the only one using trhe word "dissenter")

    (If you're not confused, you haven't been paying attention.)
    Aug 2, 2013. 10:14 PM | Likes Like |Link to Comment
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