Robbins Arroyo LLP: Acquisition of Envision Healthcare Holdings, Inc. (EVHC) by AmSurg Corp. (AMSG) May Not Be in Shareholders’ Best Interests
Robbins Arroyo LLP is investigating the proposed acquisition of Envision Healthcare Holdings, Inc. (NYSE: EVHC) by AmSurg Corp. (NASDAQ: AMSG). On June 15, 2016, the two companies announced the signing of a definitive merger agreement pursuant to which AmSurg will acquire Envision. Under the terms of the agreement, Envision shareholders will receive 0.334 shares of AmSurg common stock for each share of Envision common stock, the value of which is equivalent to $26.21.
Is the Proposed Acquisition Best for Envision and Its Shareholders?
Robbins Arroyo LLP’s investigation focuses on whether the board of directors at Envision is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the $26.21 merger consideration represents a premium of only 2.60% based on Envision’s last unaffected closing price on June 7, 2016. This premium is significantly below the average one day premium of nearly 29.05% for comparable transactions within the past three years. Further, there were 14 analysts with target prices significantly above the $26.21 merger consideration as of Envision’s last unaffected trading day on June 7, 2016, most notably the target prices of $37.00 set by an analyst at Cantor Fitzgerald on February 2, 2016, and $35.00 set by an analyst at Jefferies on May 5, 2016. In the last three years, Envision traded as high as $45.95 on August 4, 2015, and most recently traded above the merger consideration – at $27.76 – on June 14, 2016.
On May 5, 2016, Envision reported strong earnings results for its first quarter 2016. Envision reported net revenue of $1.6 billion for the three months ended March 31, 2016, a 28% increase from the same period of the prior year. Envision also reported adjusted EBITDA of $151.6 million for the three months ended March 31, 2016, an 18% increase from the same period of the prior year. Additionally, Envision has beaten analyst estimates for revenue in three of the past four quarters. In commenting on these results, Envision President and Chief Executive Officer William A. Sanger remarked, “We are pleased with the progress we have made, and will continue to make, in achieving targeted operational improvement, integrating acquisitions, and advancing new care delivery models. We expect our efforts will yield continued improvement throughout 2016.”
In light of these facts, Robbins Arroyo LLP is examining Envision’s board of directors’ decision to sell the company now rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
Envision shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information.
Envision shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.
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