Shareholder skeptical of HMA deal

NAPLES — The top shareholder of hospital operator Health Management Associates still seeks to replace the board of directors, even after a sale of the company was announced two days ago.

More than 70% of HMA's shareholders must agree to the proposed acquisition of the Naples-based hospital company for $7.6 billion by rival Community Health Systems before it can be completed early next year.

Glenview Capital Management, the New York City-based hedge fund that owns 14.6% of the shares of HMA, says a new board should study the deal and consider other offers. In a note to investors, it says the offer by Tennessee-based Community Health represents only a “floor value.”

“As the sitting board has entered into a sale agreement concurrent with management vacancy, disappointing results and a reduced outlook, it is difficult to assess whether the value offered in the Community proposal represents full and fair value or represents the price offered by an opportunistic acquirer to a distressed seller,” says the Glenview statement.

Glenview, which manages $6 billion, is lobbying HMA investors to vote to remove the current board and replace it with a new slate. HMA owns and operates 71 hospitals in non-urban areas around the country.

Community Health on Tuesday offered HMA shareholders $13.78 per share, a discount to the recent share price. The offer consists of $10.50 in cash and the rest in Community Health stock.