Who's Accipiter Capital?

Monday, July 31, 2006

The following is an excerpt from a newsletter distributed by Provident Healthcare Partners, a Boston-based investment banking firm that covers American HomePatient:
Recent SEC filings reveal that Accipiter Capital Management has increased its ownership stake in AHP to 6.1%, up from previous filings made in May, when ownership levels were at 5.1%. While their intentions are still unclear, in March the same hedge fund sent a letter to the board of directors of LifePoint Hospitals expressing their discontent with recent actions taken by LifePoint's executive management. Specifically, they encouraged LifePoint to abandon its acquisition plan of five HCA hospitals and to make changes to the management team and to the firm's board of directors. While obviously disgruntled, Accipiter did not appear to be hostile, nor was there any indication that they were looking to buyout LifePoint. Rather, Accipiter indicated that they were intent on remaining "one of LifePoint's largest stockholders for the long-term...(and wished) to engage management and the Board of Directors in a constructive dialogue regarding actions to enhance stockholder value."A similar view could be applied to the AHP situation. In fact, the SEC filing indicates that Accipiter's position in AHP was taken in belief that the shares "were undervalued and represented an attractive investment opportunity." This could very well be the case. However, given the lack of transparency that surrounds hedge funds, it is impossible to know their ultimate intentions.