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NAPLES — Glenview Capital Management rejected a proposal by hospital operator Health Management Associates to name directors to the company's board, including one to be the chairman.
Late Tuesday, HMA issued a statement saying it would accept an undisclosed number of Glenview nominees to the board. “The current HMA board believes that it is critical for there to be continuity on the board given, among other things, the ongoing government investigations, the management transition and the pending transaction with Community Health Systems Inc. HMA is prepared for one of the Glenview nominees to be chairman of the board,” the company statement says.
But Glenview rejected the overture in a statement Wednesday morning. “Glenview respectfully declines the sitting board's proposal for a sub-optimal 'hybrid' board,” says a statement from Glenview, which owns 14.6% of the HMA's shares and is the company's largest shareholder.
Shareholders of HMA, which owns and manages 71 hospitals in non-urban areas of the country, are voting to decide whether to replace the current board with a slate of directors Glenview has proposed. The hedge fund has argued that the current board has failed to meet shareholder expectations.
In addition, Glenview has argued that it's not clear HMA shareholders will benefit from the recently announced acquisition of the company by rival Community Health Systems. Community Health recently offered $13.78 per HMA share in a $7.6 billion transaction. The deal has to be approved by 70% of HMA's shareholders.
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