Other hedge funds have also invested in Tenet, and they control over a third of the shares, according to Bloomberg data. If the activists are more aggressive, they could unlock even more value than a restructured board, said Ana Gupte, an analyst for Leerink Partners, an investment bank.
“Heads you win; tails you win,” Gupte wrote in a research report last week.
That may be welcome news for investors. But the changes to come may be distracting and disruptive for 130,000 Tenet employees.
Tenet is one of the nation’s largest health care providers, with over 20,000 licensed beds. It has 77 acute-care hospitals and 460 outpatient facilities. Texas, California and Florida are among its most important states.
In the Dallas area, Tenet has about 8,300 employees, a spokesman said. They include 850 at corporate headquarters in downtown Dallas and about 1,600 at Conifer, its revenue management unit in Frisco.
Tenet also owns a majority stake in United Surgical Partners International, the nation’s largest group of outpatient surgery centers. USPI has about 3,300 workers in North Texas, including patient facilities and offices in Addison.
Tenet began to transform from a regional hospital company with the 2008 launch of Conifer, Fetter said last week. Then, in 2013, it bought Vanguard Health Systems for $4.3 billion, including debt. That increased its hospital portfolio by about 60 percent and added strong positions in Detroit, San Antonio and Phoenix.
In 2015, Tenet bought a controlling interest in USPI for about $2 billion, including debt. It has been steadily adding to the stake and will continue because outpatient surgery is a growth area with better margins.
Dallas-based Tenet borrowed billions to build a health care giant. Time to tear it down | Health Care