Glenview Capital claimed a majority of the shareholders of Health Management Associates Inc (NYSE:HMA) have voted to replace the existing board with Glenview’s slate of directors.
Activist hedge fund Glenview Capital indicated in a statement that it submitted to Health Management Associates Inc (NYSE:HMA) documentation that a majority of shareholders have voted for the removal and replacement of the entire board of directors at the U.S. hospital chain. The hedge fund indicated it anticipates the sitting Health Management Associates Board will work with their outside advisors to ensure a prompt fiduciary review of the voting results.
Glenview received ISS support
Last week, the activist hedge fund indicated that Institutional Shareholder Services supported its solicitation to refresh the sitting board of Naples-based Health Management Associates Inc (NYSE:HMA). Consequent to the blow, Health Management Associates proposed that it would consider adding all of Glenview’s eight nominees to the board as long as Glenview is willing to retain two or three current directors. Health Management Associates also indicated Glenview could also take the chairman spot.
A stunning event
Sheryl Skolnick, an analyst at CRT Capital Group, termed the ouster of Health Management Associates Inc (NYSE:HMA)’s board a ‘stunning and serious event, one that happens rarely among publicly traded companies. The analyst also cautioned that the current board may not give up its seat without a fight. The current Health Management Associates board is chaired by William Schoen, who has been chairman since 1986.
In its statement yesterday, Glenview indicated that led by future Health Management Associates Inc (NYSE:HMA) Chairman Steven Shulman, the nominees will be in contact with the outgoing Health Management Associates’ Board and their advisors for a smooth transition during this week.
Activist hedge fund Glenview Capital owns 14.6 percent of the common stock of Health Management Associates Inc through affiliated investment funds. This makes Glenview the largest shareholder in Health Management Associates Inc (NYSE:HMA).
Community Health committed to acquiring HMA
Late last month, Community Health Systems announced it would acquire Health Management Associates Inc (NYSE:HMA) for $7.6 billion including debt assumption of $3.7 billion. Community Health Systems has proposed to pay Health Management Associates shareholders $13.78 per share, plus a 16 percent stake in combined company.
Following recent majority shareholder approval to replace existing HMA Board, some thought it could throw a wrench into Community Health System’s plans to acquire Health Management Associates. However, Community Health System indicated on Monday it remained committed to acquiring Health Management Associates Inc (NYSE:HMA).