Citigroup Surprised By CYH / THC Merger Results

Community Health Systems, Inc. (NYSE: CYH) announced that Tenet Healthcare Corporation's (NYSE: THC) board had rejected an unsolicited $6 bid ($5 cash, $1 stk), Citigroup reports.

“We are surprised, but have a hard time being critical and see parallels to CYH's 2007 Triad Hospitals acquisition,” Citigroup writes. “CYH shares will likely be down tomorrow - our inclination is to buy the weakness, we think the market will grow to like this deal as long as a competing bidder does not emerge to push the price above $7.”

Community Health Systems closed Thursday at $31.64; Tenet Healthcare closed at $4.29.