Kindred Healthcare is offering more cash for shares of Gentiva Health Services Inc., but it now aims to acquire just a slice of the home health and hospice care provider instead of the whole company.
Kindred said Monday that it will pay $16 per share in cash to buy up to a 14.9 percent stake in Gentiva. That total would make Kindred Gentiva's largest shareholder but would fall short of the 15 percent limit imposed by a shareholder rights plan, or "poison pill" measure, that Gentiva's board adopted after Kindred started bidding for the company earlier this year.
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Earlier this month, Kindred had urged Gentiva shareholders to send a "strong signal" to their board by tendering their stock in support of its previous bid of $14.50 per share for the whole company, even though the poison pill would limit Kindred.
That $573 million bid represented an increase from an offer totaling $533 million, or $14 per share in cash and stock, that Kindred announced in May.
Gentiva has said the $14.50-per-share offer significantly undervalued the company and was opportunistic because it exploited a temporary decrease in Gentiva's stock price.
Louisville, Kentucky-based Kindred runs nursing and rehabilitation centers, and its executives say the two companies are "highly complementary."
Kindred CEO Paul J. Diaz said in a statement that his company won't consider increasing its offer again until the leaders of Atlanta-based Gentiva agree to talk and "demonstrate additional value in the due diligence process."
Kindred's latest tender offer for Gentiva's stock expires at 5 p.m. Eastern time July 28.
Shares of Kindred climbed 22 cents to $24.60 Monday morning, while Gentiva jumped 3 percent, or 51 cents, to $16.33. Meanwhile, the Nasdaq composite was up less than 1 percent.