Chemed to keep Roto-Rooter, Vistas combined

By Lisa Kerner

Charlotte, N.C., March 16 - Chemed Corp. said it does not intend to pursue a separation of its two businesses, Vistas and Roto-Rooter, as suggested by shareholder MMI Investments, LP in February.

In a March 16 letter to MMI, Chemed said its board of directors reviewed the suggested structural changes with outside advisers and determined that separating the businesses at this time would be risky.

"Although we firmly believe that our two businesses are currently more valuable to stockholders together than apart, due to our foresight and planning, we are well-positioned to separate the businesses if and when the time is right," the letter said.

As previously reported, MMI, a 3.6% shareholder, said it believes a tax-free spinoff of Chemed's Roto-Rooter and Vistas businesses could boost the Cincinnati-based company's per-share price by 40% to 75%.

The benefits of a tax-free spinoff, according to MMI, include separate access to equity and debt capital markets and an increased management focus on each of the businesses' needs.

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