Kindred Issues Response to Gentiva

Kindred Healthcare, Inc. (“Kindred” or the “Company”) KND today responded to the decision by the board of directors of Gentiva Health Services, Inc. (“Gentiva”) GTIV recommending against Kindred's offer to acquire all of Gentiva's outstanding common stock for $14.50 per share in cash. Paul J. Diaz, Chief Executive Officer of Kindred, said, “After reviewing Gentiva's recommendation, it remains clear that Kindred's offer would create immediate, certain and superior value for Gentiva shareholders. We call on the Gentiva board and management team to sit down and negotiate a transaction that would advance the interests of both companies' shareholders, employees and patients, as well as our country's healthcare delivery system. We also call on Gentiva shareholders to make their voices heard by tendering their shares in support of Kindred's value enhancing offer.” Kindred noted the following: * Kindred's all-cash offer provides immediate and certain value to Gentiva's shareholders at a time when Gentiva's prospects are uncertain. Gentiva highlighted its pre-offer 52-week high stock price of $13.85, which it reached on August 14, 2013. Notably, this was before the market reflected a wide range of new concerns about Gentiva, including operational difficulties and integration challenges. In addition, the August 14, 2013 stock price does not reflect the material changes to home health reimbursement (“rebasing”) that became effective on January 1, 2014, nor does it account for significant reimbursement headwinds that Gentiva will face this year and for several years to come. As a multiple of EBITDA, our proposal represents a valuation greater than Gentiva has achieved on a standalone basis at any point during the last five years leading up to our offer. * Kindred's offer represents a 45% premium to Wall Street analysts' unaffected one-year median price target of $10.00 per share. We believe that Gentiva based its recommendation to its shareholders on unsubstantiated projections that are inconsistent with the market's assessment of Gentiva's prospects. While Gentiva is using analyst estimates for its peers, it is asking its shareholders to trust management's projections, which have been unreliable in the past, and which Wall Street does not believe are achievable. * Kindred's $14.50 per share cash offer values Gentiva at approximately 9.3 times research analysts' 2014 EBITDA estimates. Gentiva's public company peers trade at an average enterprise value of approximately 9.4 times research analysts' 2014 EBITDA estimates. Discussions and appropriate due diligence would help determine any additional value to be delivered through Gentiva's ‘One Gentiva' plan. * Kindred is prepared to share the expected synergies with Gentiva shareholders through cash and stock consideration. Gentiva noted that its shareholders should also benefit from the synergies to be realized in the proposed combination. Kindred's offer to include equity - which many Gentiva shareholders have told us they would prefer - would allow Gentiva shareholders to participate in the upside potential of the proposed combination. Kindred believes its all-cash offer would deliver immediate and certain value that significantly exceeds what Gentiva shareholders could expect Gentiva to deliver on a standalone basis. The Kindred offer of $14.50 per share represents a 70% premium to Gentiva's closing share price on May 14, 2014 (the day prior to Kindred making its proposal public) and a 64% premium over Gentiva's 60-day volume-weighted average closing price on May 14, 2014. In order to send a strong signal to the Gentiva board, Kindred continues to urge all Gentiva shareholders to tender their shares in support of its value enhancing offer. If a majority of the outstanding Gentiva shares are tendered prior to July 16, 2014, Kindred intends to amend the offer to seek to purchase 14.9% of Gentiva's outstanding shares, positioning Kindred as Gentiva's largest shareholder.