Beverly buys some time by seeking new bidders

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Almost from the beginning, Beverly Enterprises' directors did not want to sell the company to an uninvited suitor. Beverly (now BEI) leaders said an unsolicited bid was too low — and backed by questionable financing.

Company officials also said they were bringing in financial muscle to thwart a hostile takeover attempt.
But when key stockholders made it clear that leadership change was imminent, new tactics were needed.
By putting the nation's largest nursing home operator on the auction block, the current board gains two quick benefits. One is a delay in the transfer of power that was otherwise likely to occur during a stockholders' meeting April 21. Moreover, the move allows new players -- including Beverly's current leadership -- to bid for the firm.
The current stage was set after BEI's board quickly rejected a bid of $1.5 billion for the company from a consortium led by Formation Capital in January.
Recent meetings in New York and Boston with 23 institutional stockholders (who hold a combined 34% of BEI's stock) revealed, however, that BEI's strategic plan was no longer in favor with key stakeholders.
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