In a move seen as a "shadow vote" on the recently announced merger between Health Management Associates and Community Health Systems, HMA's largest shareholder has pushed out the sitting board and replaced it.
Glenview Capital Management, a New York City-based hedge fund, has unseated the board of Health Management Associates.
Late Monday afternoon Glenview Capital announced that it had submitted to the "appropriate representatives of HMA" documentation confirming that a majority of HMA stockholders had voted to remove all of the current HMA board members and replace them with a Glenview-backed board.
The action is considered by some observers as a "shadow vote" on the recently announced merger between HMA and the Nashville-based Community Health Systems, which would create the largest for-profit hospital system in the U.S. For its part CHS released this statement: "Our definitive agreement to acquire HMA remains unchanged. We look forward to working constructively with the new board of directors at HMA to complete this strategic transaction."
In a statement issued late Monday, HMA said "The HMA board is committed to ensuring an orderly transition if the written consents delivered by Glenview are validated by the independent inspector of election.
Glenview, HMA's largest shareholder, with 14.6% of the stock, has been a strong critic of the merger. In a press statement commenting on the merger the firm said the $7.6 billion CHS proposal "establishes an important floor value" for HMA shareholders to evaluate. "As the sitting board has entered into a sale agreement concurrent with management vacancy, disappointing results, and a reduced outlook, it is difficult to assess whether the value offered… represents full and fair value or the price offered by an opportunistic acquirer to a distressed seller."