HMA and CHS amend merger agreement
Health Management Associates Inc. and Community Health Systems Inc. have amended their July merger agreement, which was followed by a HMA board overhaul that left the deal's future in question.
According to a regulatory filing, the major parts of the amendment are as follows.
• HMA may engage Lazard Frères & Co. LLC and UBS Securities LLC to analyze the business and financial condition of HMA and the financial terms of the merger.
• If HMA requests either of those advisers to render an opinion on the fairness, from a financial point of view, of the merger consideration, the opinion will be delivered by Nov. 19.
• If either of the advisers disagrees with the previous finding that the merger is fair, it will be considered a "company adverse recommendation change," including for purposes of triggering CHS's termination rights and, if CHS elects to terminate, the obligation of HMA to pay a termination fee of $109 million to CHS.
• HMA cannot delay the special meeting of HMA stockholders to vote on the merger agreement to a date that is on or after the third business day prior to April 30, 2014, without CHS's prior written consent.
HMA, based in Florida, currently operates 71 hospitals in 15 states, including three local facilities: Carlisle Regional Medical Center, Lancaster Regional Medical Center and Heart of Lancaster Regional Medical Center. CHS, based in Tennessee, currently owns, leases or operates 135 hospitals in 29 states, including one local facility, Memorial Hospital in York.
Shares of the companies are traded on the New York Stock Exchange under ticker symbols HMA and CYH.