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Community Health makes all-cash bid for Tenet

Mon, 04/18/2011 - 4:45am
The Associated Press

Hospital operator Community Health Systems Inc. is revising its $3 billion offer for rival Tenet Healthcare Corp. to an all-cash bid.

The offer values Tenet at $6 per share. In December, Community Health Systems went public with a bid of $5 per share in cash and $1 per share in stock. At the time Community Health offered a premium of about 40 percent on the Dallas company's shares.

Tenet's board has rejected the offer, and adopted the offer with a "poison pill" measure.

Earlier this month Tenet filed a lawsuit that alleges Community Health Systems bilked Medicare. The Franklin, Tenn., company says the allegations in the lawsuit are "irresponsible and inaccurate."

Community Health shares slid $3.85, or 12 percent, to $28.05 in pre-market trading while Tenet shares fell 21 cents, or 3 percent, to $6.45.

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