Nursing Home Company Accepts Sweetened Offer

From Associated Press - August 25th, 2005 (latimes.com)

LITTLE ROCK, Ark. — Nursing home operator Beverly Enterprises Inc. said Wednesday that it accepted a sweetened takeover bid from North American Senior Care Inc. that values the company at more than $1.9 billion and narrowly tops a counteroffer made last week by a rival bidder.

Under the revised deal, North American Senior Care would pay $13 a share in cash to acquire Beverly, whose directors have voted in favor of the proposal because they say it is in the best interests of its shareholders.

The bid from North American Senior Care, an investor group assembled for the Beverly transaction, is up from its previous offer of $12.80 a share and tops the recent $12.90-a-share bid by an investor group led by Formation Capital. Formation Capital had led a hostile takeover attempt of Beverly earlier in the year, and that prompted Beverly to put itself up for sale.

North American would absorb $339 million in Beverly debt, a figure that applies Fort Smith, Ark.-based Beverly's $213 million in cash on hand to its debt total.

Despite the higher offers, Beverly shares fell 8 cents to $12.67.

For Formation or another investor to try to top North American's bid, the investor would have to pay a $40-million termination fee. Such a fee was in place after the initial bid but was lower at that time, Beverly spokesman Blair Jackson said.

Beverly operates 346 skilled nursing facilities, 18 assisted living centers and 56 hospice and home care agencies. It offers rehabilitation services to nursing homes through Aegis Therapies.

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