Beverly CEO Scolds Group As Takeover Bid Continues

by Arkansas Business staff  on Friday, Jan. 28, 2005 11:23 am  

Beverly Enterprises Inc. President and CEO William Floyd on Thursday released a blistering letter to Formation Capital CEO Arnold Whitman in which he blasted the investor group for acting in bad faith in its attempt to take over the nursing home chain.

In the letter, Floyd said his Fort Smith company is reviewing the group's offer to buy the company in a $1.45 billion deal but added that Formation Capital's actions have created a disruptive environment for negotiations.

"Your failure to deal candidly with us, your clearly hostile and secret acquisition of shares, your disorganized communications and your unjustified impatience are counterproductive to this process — and hardly designed to create a setting for the constructive negotiations you purportedly desire," Floyd wrote.

Click here to read the full letter.

An investor group — including Formation Capital, Appaloosa Management LP, Franklin Mutual Advisors LLC and Northbrook NBV LLC — filed documents with the Securities and Exchange Commission this week saying that it had offered Beverly $11.50 per share for the company or $1.2 billion for its nursing homes. The investors group already owns 8 percent of the company.

But the following day, Beverly adopted a shareholder rights plan to guard against company takeovers.

Shares of Beverly (NYSE: BEV) were trading unchanged at $11.92 on Friday.

 

 

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