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 THE RESULT: Caymus Partners acted as a financial advisor to the Board of Directors of SunLink Health Systems, Inc (AMEX: SSY) (“SunLink” or the “Company”) in its adoption of a shareholder rights plan, or “poison pill”, as it successfully defended itself against an unsolicited takeover attempt. The Company continues to work with Caymus Partners on strategic growth initiatives and other issues.
"Caymus Partners really came through for us when we needed them. Caymus Partners was able to move quickly and provide our board with sound advice in taking the appropriate actions to remain independent. Their work ethic, attention to detail and ability to understand our business and strategy sets them apart and has made them instrumental to our growth and success. Caymus Partners has been a true partner and we continue to work with them on an ongoing basis."
Bob Thornton, Chief Executive Officer
SunLink Health Systems, Inc.
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Company Description
SunLink is a non-urban community healthcare provider with seven hospitals and related businesses in four states in the Southeast and Midwest. Each SunLink hospital is the sole acute general healthcare provider in its community. The Company strategically acquires, manages and grows its facilities to improve healthcare in the communities it serves.
Client Objective
SunLink was executing very well against its business plan but believed the public market price for its stock did not adequately reflect the value of the underlying business. As a result, when an unsolicited bid was made for the Company, SunLink required strategic advice on takeover defense. Caymus Partners recommended and assisted in the implementation of a shareholder rights plan.
Challenges Overcome
Caymus Partners overcame a number of key challenges in making this transaction successful:
- Choosing Appropriate Course of Action. While there are many takeover defense mechanisms available, Caymus Partners was very familiar with SunLink’s business and knew that a poison pill would be the most effective approach in blocking the unsolicited offer;
- Rapid Response Required. Securities regulations require a timely response in situations such as this and Caymus Partners moved quickly in evaluating the unsolicited bid and structuring the poison pill;
- Detailed Financial Analysis. Caymus Partners provided detailed financial and scenario analyses that supported the decision to put in place a poison pill and position the Company for increasing and protecting shareholder value; and
- Increasing Public Market Awareness. SunLink’s stock price and liquidity increased considerably in the months following the adoption of the poison pill, reflecting increased awareness of the Company and a valuation level more in line with its business fundamentals.
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