The Tenet Healthcare Corporation has received a revised proposal from Community Health Systems to acquire all of the outstanding shares of Tenet for $6 per share in cash.
CHS has been attempting to acquire Tenet since last fall. Tenet has repeatedly fended off these attempts, even going so far as to file a lawsuit last week.
The lawsuit, filed in the U.S. District Court in the Northern District of Texas, alleges that CHS improperly bills some cases, which results in inflated revenue and earnings for the hospital operator.
When news of the lawsuit broke last week, Tenet’s stock dropped to $6.13 a share and CHS’ shares dropped to $24.52. As of Monday morning, Tenet’s stock was at $6.44 a share and CHS’ was at $28.07.
CHS’ revised proposal is for the same price as a previous proposal received by Tenet on Nov. 12, 2010. Tenet rejected that offer, stating in a letter to CHS that it had unanimously determined that the CHS proposal grossly undervalued Tenet and was not in the best interests of Tenet or its shareholders.
Tenet's Board of Directors will review the revised proposal and have asked Tenet's shareholders to take no action at this time.