Monday, July 14, 2014

Kindred Offers $16 per share for 14.9% of Gentiva


Kindred Healthcare upped their offer to $16 a share for the maximum amount of Gentiva stock under a board adopted poison pill.  Kindred started with a $14 offer, bumped it up to $14.50 before their latest raise.  This plays into Gentiva's meme of Kindred taking advantage of their undervalued status.

Kindred tried to frame this issue in their favor by asking Gentiva's board to explain why they deserve more.  Gentiva consistently refused to come to the negotiating table and I expect that to continue.

Neither party has revealed the extent to which they have Wall Street's support.  Both sides employ an army of supporters to work behind the scenes on the deal.  Kindred remains on offense with Gentiva playing defense. 

As for value creating or destroying, both companies employ management practices that tear people down and destroy quality.  Both cheated employees of fair pay and government payors in the provision of care.

Management language has little true meaning at Gentiva, in that it is not lived.  Leaders' words are used to double bind people into robotic, reflexive responses.  A mind is a terrible thing to waste, but a heart is an awful thing to break.  Gentiva leaders use fear and intimidation to do both.

I expect Kindred offers a slightly different version of management manipulation, especially given their behavior in pursuing of Gentiva.  "We will not be deterred..."

Gentiva will eventually implode under its obscene debt load and management ineptness.  I've seen from the inside Gentiva's sorry employee relations and declining customer service.  Develeraging by overpaying for companies and destroying their value is not a winning strategy.  Yet Gentiva may punch this losing lottery ticket yet again with Amedisys.

Will Kindred take the hint and walk?  The testosterone meter says no.

Anonymous (from Gentiva)

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