Glenview Capital Management, the largest of Health Management Associates' shareholders, is calling for a major leadership change at HMA. It sees "a deficiency at both the board and management level" and wants a new board of directors.
UPDATE: 7/10/2013: Reuters reports that rivals of Health Management Associates, including Community Health Systems, are discussing a potential deal to buy the $4 billion hospital operator.
Troubles have worsened for beleaguered, for-profit, publicly-traded hospital chain Health Management Associates. Glenview Capital Management, its largest shareholder, filed documents this month with the Securities and Exchange Commission calling for the replacement of its board of directors.
New York City-based hedge fund Glenview owns 14.6% of the company's stocks. Headquartered in Naples, FL, HMA operates 71 healthcare organizations in 15 states.
In the SEC filing, Glenview says, "…[W]e are setting forth a path that we believe creates the strongest future for HMA's patients, employees, and investors while minimizing the risk to each vital constituency. We suggest HMA shareholders consent to fully reconstitute the Board…"
Glenview recommended replacing the board with "highly qualified, independent, newly elected directors" which it dubbed the "Fresh Alternative."
"We believe that our shared investment in HMA is best served with a Board who has the capabilities, vision, tenacity, and spirit to build a strong independent HMA and resolve legacy regulatory issues while concurrently being open to all avenues of shareholder value creation, including strong capital allocation and the rigorous evaluation of all strategic alternatives," the filing reads.