Business & Finance
Business and Finance
Business and Finance
Mon, December 15, 2008 Clear Choice Health Plans Rejects Agate Resources Unsolicited Acquisition Proposal
BEND, Ore.--([ BUSINESS WIRE ])--Clear Choice Health Plans, Inc. (OTCBB:CCHN) said today it has rejected an unsolicited proposal from Agate Resources, a privately-owned company based in Eugene, Ore., to acquire Clear Choice through a stock swap with a newly formed entity. Under the Agate proposal, Clear Choice would become a wholly-owned subsidiary of the newly formed entity.
Clear Choice said that Agate's characterization of its proposal to the public as a "partnership" between the two companies is inaccurate and misleading. Under the Agate proposal, on a net book value basis the Agate shareholders would receive stock in the newly formed entity that reflects a 38% premium and the Clear Choice shareholders would receive a 38% discount. Moreover, the newly formed entity would be controlled by representatives selected by Agate Resources, which is headquartered in Eugene.
Jerry Andres, chairman of the board of Clear Choice, said, "We are not surprised that Agate has expressed interest in our company and recognizes the strength of its balance sheet, geographic diversity and dominant market position in Central Oregon. However, we believe Agate is clearly not a fit for Clear Choice, nor would the proposed transaction be in the best interests of our shareholders.
"Clear Choice management has strategically balanced and diversified the company's portfolio of business among Oregon Health Plan, Medicare Advantage and a growing line of commercial products," Andres said. "Agate's nearly singular focus on Oregon Health Plan business would expose our shareholders to the significantly greater risk and vulnerability that is inherent in too high a concentration in one business sector. Moreover, we believe the real motive behind Agate's proposal is to get access to our cash and liquid assets in order to fund their expansion into Central Oregon and obtain a commercial product line."
Patricia Gibford, CEO and president of Clear Choice, added, "While Agate has portrayed its proposal as a ‘partnership' between the two companies, it is really nothing more than an attempted takeover of Clear Choice at grossly inadequate consideration that would harm our shareholders and adversely impact our business."
About Clear Choice Health Plans
Clear Choice offers affordable health plans to meet the needs of employers, providers and consumers. The company provides health insurance, including Medicare Advantage plans, commercial plans, individual plans and administrative services to individuals and businesses throughout the region. The company also offers life, disability, dental, vision and voluntary benefits programs. Clear Choice is dedicated to the development of community-based health insurance plans. For information call 888-677-5852, visit [ www.clearchoicehp.com ].
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995
Certain statements contained in this press release are forward-looking in nature and involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. The words "believe," "estimate," "expect," "intend," "anticipate," "plan," "appears," "will," "anticipates'', and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates on which they were made. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Readers are cautioned not to place undue reliance on these forward-looking statements.
