KENNETT SQUARE, Penn., Nov. 17 /PRNewswire-FirstCall/ -- Genesis Health Ventures, Inc. ("GHVI") today announced that its Board of Directors has declared a dividend distribution of one Preferred Share Purchase Right on each outstanding share of GHVI common stock.
"The Rights are designed to assure that all of GHVI 's stockholders receive fair and equal treatment in the event of any proposed takeover of the Company and to guard against abusive tactics to gain control of GHVI without paying all stockholders a premium for that control," stated Robert H. Fish, Chairman and Chief Executive Officer of GHVI. "Rights are not being adopted in response to any specific takeover threat, but are a prudent step as we move forward following the spin-off of our eldercare business."
The Rights are intended to enable all GHVI stockholders to realize the long-term value of their investment in the Company. The Rights will not prevent a takeover, but should encourage anyone seeking to acquire the Company to negotiate with the Board prior to attempting a takeover.
The Rights will be exercisable only if a person or group acquires 20% or more of GHVI's common stock or commences a tender offer the consummation of which would result in ownership by a person or group of 20% or more of the common stock. Each Right will entitle stockholders to buy one one-hundredth of a share of a new series of junior participating preferred stock at an exercise price of $100.00.
If a person or group acquires 20% or more of GHVI's outstanding common stock, each Right will entitle its holder (other than such person or members of such group) to purchase, at the Right's then-current exercise price, a number of GHVI's common shares having a market value of twice such price. In addition, if GHVI is acquired in a merger or other business combination transaction after a person has acquired 20% or more of the Company's outstanding common stock, each Right will entitle its holder to purchase, at the Right's then-current exercise price, a number of the acquiring company's common shares having a market value of twice such price. The acquiring person will not be entitled to exercise these Rights.
Prior to the acquisition by a person or group of beneficial ownership of 20% or more of the Company's common stock, the Rights are redeemable for one cent per Right at the option of the Board of Directors.
The Board of Directors is also authorized to reduce the 20% thresholds referred to above to not less than 10%.
The dividend distribution of Rights will be made on December 1, 2003, payable to stockholders of record on that date, and is not taxable to stockholders. The Rights will expire on December 1, 2013.
About Genesis Health Ventures
Genesis Health Ventures provides healthcare services to America's elders through a network of NeighborCare pharmacies and Genesis ElderCare skilled nursing and assisted living facilities. Other Genesis healthcare services include rehabilitation and respiratory therapy, hospitality services, group purchasing, and diagnostics.
Visit our websites at http://www.ghv.com/ .
Statements made in this release, our website and in our other public filings and releases, which are not historical facts contain "forward-looking" statements (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties and are subject to change at any time. These forward-looking statements may include, but are not limited to, statements containing words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "may," "target" and similar expressions. Such forward-looking statements include, without limitation, statements regarding the effect and timing of the spin-off of our eldercare operations, expected changes in reimbursement rates, inflationary increases in state Medicaid rates, self-insurance retention limits, and earnings guidance for the fiscal year 2003. Factors that could cause actual results to differ materially include, but are not limited to, the following: costs, delays and other difficulties related to the spin-off, changes in the reimbursement rates or methods of payment from Medicare or Medicaid, or the implementation of other measures to reduce reimbursement for our services; changes in pharmacy legislation and payment formulas; the expiration of enactments providing for additional government funding; efforts of third party payors to control costs; the impact of federal and state regulations; changes in payor mix and payment methodologies; further consolidation of managed care organizations and other third party payors; competition in our business; an increase in insurance costs and potential liability for losses not covered by, or in excess of, our insurance; competition for qualified staff in the healthcare industry; our ability to control operating costs, and generate sufficient cash flow to meet operational and financial requirements; an economic downturn or changes in the laws affecting our business in those markets in which we operate; the terms of any share repurchase; that there can be no assurance that any spin-off transaction will be completed or completed in the expected timeframe and if completed will increase shareholder value, and that there can be no assurance that the proposed transactions with ElderTrust and related partnerships will be completed, will be completed on the expected terms and in the expected timeframe or will have the expected economic effect.
The forward-looking statements involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control. We caution investors that any forward-looking statements made by us are not guarantees of future performance. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions to any of the forward-looking statements to reflect future events or developments.
CONTACTS: Tania Almond, NeighborCare - Investor Relations 410-752-2600
Genesis Health VenturesCONTACT: Tania Almond, Investor Relations of NeighborCare,+1-410-752-2600, for Genesis Health Ventures
Web site: http://www.ghv.com/