Business
HCA buyout approved
NEWS IN BRIEF — Posted Dec. 4, 2006
HCA shareholders on Nov. 16 approved a $33 billion leveraged buyout, which had been announced in July.
HCA had reached an agreement to be taken private by a consortium of investors for $21 billion, plus the assumption or repayment of nearly $12 billion in debt. The investor group included Bain Capital, Kohlberg Kravis Roberts & Co., Merrill Lynch and the family of HCA co-founder Thomas F. Frist Jr., MD.
A group of shareholders sued to stop the deal, arguing that the stock price was undervalued under the terms of the deal. But the lawsuit was unable to prevent the shareholder vote from proceeding.
This is HCA's second leveraged buyout, taking the company from being traded publicly to private hands. In 1989, it went private in a management-led buyout for $5.1 billion. Three years later, HCA launched an IPO and returned to public trading. Like the latest deal, the 1989 deal was done in part because management saw the company's stock price dropping and considered the firm undervalued.
The Nashville-based hospital chain owns and operates about 172 hospitals and 95 freestanding surgery centers and facilities.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2006/12/04/bibf1204.htm.
