The Wall Street Journal reports (link good for 7 days) that a group of private investors, including members of the founding Frist family, nearly consummated a buyout of HCA over the weekend. With a market capitalization of $17.6 billion, HCA's sale would have been one of the largest in recent memory. It apparently cratered because of the size of HCA's debt ($11 billion), which left the parties about 10% apart on the price. This morning, traders took the attempted buyout as a clear signal that HCA management regards its stock as undervalued in the market. As a result, according to a late-morning story on WSJ_online, HCA's stock price is up 1.5% this morning, while its junk bonds are down sharply.
Wednesday, July 19, 2006
HCA nearly bought out in recent days
The Wall Street Journal reports (link good for 7 days) that a group of private investors, including members of the founding Frist family, nearly consummated a buyout of HCA over the weekend. With a market capitalization of $17.6 billion, HCA's sale would have been one of the largest in recent memory. It apparently cratered because of the size of HCA's debt ($11 billion), which left the parties about 10% apart on the price. This morning, traders took the attempted buyout as a clear signal that HCA management regards its stock as undervalued in the market. As a result, according to a late-morning story on WSJ_online, HCA's stock price is up 1.5% this morning, while its junk bonds are down sharply.
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