Covington Investments LLC Wednesday expressed its disappointment to Advocat Inc (AVCA) after the Board of Directors of the latter rejected the proposal from Covington to purchase all common shares of Advocat for $8.50 per share in cash in a negotiated transaction:
In an open letter addressed to the shareholders of Advocat, Covington Investments stated that the proposed price of $8.50 a share represents almost a 100% premium to the unaffected share price and values Advocat at premium multiples compared to other publicly traded skilled nursing facility companies.
Covington Investments further added that the majority of the shareholders have not been consulted on the offer and the decision to unilaterally reject the proposal has been taken by the Chairman and the Vice Chairman of the company.
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