Schedule 13G Amendment No. 2

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TdmbpMFooDzQTpvOWkrTxBQHiRMPYICrrk7bJ+PsWOi8Ww0NKmEDbdftTTxhcgqy bYu4S3usMfYUubBjK7PGhw== 0001193125-06-144733.txt : 20060711 0001193125-06-144733.hdr.sgml : 20060711 20060711160129 ACCESSION NUMBER: 0001193125-06-144733 CONFORMED SUBMISSION TYPE: SC 13G/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20060711 DATE AS OF CHANGE: 20060711 GROUP MEMBERS: HIGHFIELDS ASSOCIATES LLC GROUP MEMBERS: HIGHFIELDS CAPITAL III L.P GROUP MEMBERS: HIGHFIELDS GP LLC GROUP MEMBERS: JONATHON S. JACOBSON GROUP MEMBERS: RICHARD L. GRUBMAN SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: HEALTHSOUTH CORP CENTRAL INDEX KEY: 0000785161 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SPECIALTY OUTPATIENT FACILITIES, NEC [8093] IRS NUMBER: 630860407 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13G/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-38272 FILM NUMBER: 06956280 BUSINESS ADDRESS: STREET 1: ONE HEALTHSOUTH PKWY STREET 2: STE 224W CITY: BIRMINGHAM STATE: AL ZIP: 35243 BUSINESS PHONE: 2059677116 MAIL ADDRESS: STREET 1: ONE HEALTHSOUTH PARKWAY CITY: BIRMINGHAM STATE: AL ZIP: 35243 FORMER COMPANY: FORMER CONFORMED NAME: HEALTHSOUTH REHABILITATION CORP DATE OF NAME CHANGE: 19920703 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HIGHFIELDS CAPITAL MANAGEMENT LP CENTRAL INDEX KEY: 0001079563 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13G/A BUSINESS ADDRESS: STREET 1: 200 CLARENDON STREET 51ST FLOOR CITY: BOSTON STATE: MA ZIP: 02117 BUSINESS PHONE: 6178507500 SC 13G/A 1 dsc13ga.htm SCHEDULE 13G AMENDMENT NO. 2 Schedule 13G Amendment No. 2

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13G/A

Under the Securities Exchange Act of 1934

(Amendment No. 2)*

HEALTHSOUTH CORPORATION

(Name of Issuer)

COMMON STOCK, PAR VALUE $0.01 PER SHARE

(Title of Class of Securities)

421924101

(CUSIP Number)

JULY 1, 2006

(Date of Event Which Requires Filing of this Statement)

Check the appropriate box to designate the rule pursuant to which this Schedule is filed:

¨ Rule 13d-1(b)

x Rule 13d-1(c)

¨ Rule 13d-1(d)

The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).


CUSIP No. 421924101		13G/A		Page 2 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Highfields Capital Management LP
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		39,751,013*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		39,751,013*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	39,751,013*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	9.8%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	PN

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 3 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Highfields GP LLC
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		39,751,013*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		39,751,013*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	39,751,013*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	9.8%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	OO

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 4 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Highfields Associates LLC
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		Delaware


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		39,751,013*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		39,751,013*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	39,751,013*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	9.8%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	OO

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 5 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Jonathon S. Jacobson
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		39,751,013*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		39,751,013*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	39,751,013*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	9.8%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	IN

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 6 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Richard L. Grubman
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		United States


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		39,751,013*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		39,751,013*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	39,751,013*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	9.8%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	IN

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 7 of 14 Pages


1.		NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

		Highfields Capital III L.P.
2.		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
		(a) ¨
		(b) ¨
3.		SEC USE ONLY

4.		CITIZENSHIP OR PLACE OF ORGANIZATION

		Cayman Islands, B.W.I.


NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		5. SOLE VOTING POWER

		29,172,132*
		6. SHARED VOTING POWER

		—0—
		7. SOLE DISPOSITIVE POWER

		29,172,132*
		8. SHARED DISPOSITIVE POWER

		—0—


9.	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	29,172,132*
10.	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)	¨

11.	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 9

	7.2%*
12.	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)

	PN

*	See Item 4.


CUSIP No. 421924101		13G/A		Page 8 of 14 Pages


Item 1(a).	Name of Issuer:

	HealthSouth Corporation (the “Issuer”)

Item 1(b).	Address of Issuer’s Principal Executive Offices:

	One HealthSouth Parkway, Birmingham, AL 35243

Item 2(a).	Name of Person Filing:

	This statement is being filed by the following persons with respect to the shares of common stock (“Common Stock”) of the Issuer directly owned by Highfields Capital I LP (“Highfields I”), Highfields Capital II LP (“Highfields II”) and Highfields Capital III L.P. (“Highfields III” and, collectively, the “Funds”):

	(i)	Highfields Capital Management LP, a Delaware limited partnership (“Highfields Capital Management”) and investment manager to each of the Funds;

	(ii)	Highfields GP LLC, a Delaware limited liability company (“Highfields GP”) and the General Partner of Highfields Capital Management;

	(iii)	Highfields Associates LLC, a Delaware limited liability company (“Highfields Associates”) and the General Partner of the Funds;

	(iv)	Jonathon S. Jacobson, a Managing Member of Highfields GP and a Senior Managing Member of Highfields Associates; and

	(v)	Richard L. Grubman, a Managing Member of Highfields GP and a Senior Managing Member of Highfields Associates.

	This statement is also being filed by Highfields III, an exempted limited partnership organized under the laws of the Cayman Islands, B.W.I., with respect to the shares of Common Stock of the Issuer owned by Highfields III (which shares of Common Stock are also included in the filings for Highfields Capital Management, Highfields GP, Highfields Associates, Mr. Jacobson and Mr. Grubman). Highfields Capital Management, Highfields GP, Highfields Associates, Highfields III, Mr. Jacobson and Mr. Grubman are sometimes individually referred to herein as a “Reporting Person” and collectively as the “Reporting Persons.”

Item 2(b).	Address of Principal Business Office or, if None, Residence:

	Address for Highfields Capital Management, Highfields GP, Highfields Associates, Mr. Jacobson and Mr. Grubman: c/o Highfields Capital Management John Hancock Tower 200 Clarendon Street, 51st Floor Boston, Massachusetts 02116 Address for Highfields III: c/o Goldman Sachs (Cayman) Trust, Limited Harbour Centre, Second Floor George Town, Grand Cayman Cayman Islands, B.W.I.

Item 2(c).	Citizenship:

	Highfields Capital Management – Delaware Highfields GP – Delaware Highfields Associates – Delaware Jonathon S. Jacobson – United States Richard L. Grubman – United States Highfields III – Cayman Islands, B.W.I.

Item 2(d).	Title of Class of Securities:

	Common Stock, par value $0.01 per share

Item 2(e).	CUSIP Number:

	421924101

Item 3.	Not applicable.


CUSIP No. 421924101		13G/A		Page 9 of 14 Pages


Item 4.	Ownership.

	For Highfields Capital Management, Highfields GP, Highfields Associates, Mr. Jacobson and Mr. Grubman:

	(a)	Amount beneficially owned:

		39,751,013 shares of Common Stock

	(b)	Percent of class:

		9.8%

	(c)	Number of shares as to which such person has:

		(i)	Sole power to vote or to direct the vote:

			39,751,013

		(ii)	Shared power to vote or to direct the vote:

			—0—

		(iii)	Sole power to dispose or to direct the disposition of:

			39,751,013

		(iv)	Shared power to dispose or to direct the disposition of:

			—0—

	For Highfields III:

	(a)	Amount beneficially owned:

		29,172,132 shares of Common Stock

	(b)	Percent of class:

		7.2%

	(c)	Number of shares as to which such person has:

		(i)	Sole power to vote or to direct the vote:

			29,172,132

		(ii)	Shared power to vote or to direct the vote:

			—0—

		(iii)	Sole power to dispose or to direct the disposition of:

			29,172,132

		(iv)	Shared power to dispose or to direct the disposition of:

			—0—

	Each of the Reporting Persons listed above has acquired convertible preferred stock, which is convertible into shares of Common Stock. The information set forth herein includes the amount of Common Stock that the Reporting Persons are entitled to acquire.

Item 5.	Ownership of Five Percent or Less of a Class.

	Not applicable.

Item 6.	Ownership of More than Five Percent on Behalf of Another Person.

	The shares of Common Stock beneficially owned by Highfields Capital Management, Highfields GP, Highfields Associates, Mr. Jacobson and Mr. Grubman are beneficially owned by the Funds. Highfields III beneficially owns 7.2% of the shares and each of Highfields I and Highfields II individually owns less than 5% of the shares of Common Stock. Highfields Capital Management serves as the investment manager to each of the Funds. Each of Highfields Capital Management, Highfields GP, Highfield Associates, Mr. Jacobson and Mr. Grubman has the power to direct the dividends from or the proceeds of the sale of the shares owned by the Funds.

Item 7.	Identification and Classification of the Subsidiary Which Acquired the Security Being Reported on by the Parent Holding Company.

	Not applicable.

Item 8.	Identification and Classification of Members of the Group.

	Not applicable.

Item 9.	Notice of Dissolution of Group.

	Not applicable.

Item 10.	Certification.

	By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect.


CUSIP No. 421924101		13G/A		Page 10 of 14 Pages

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

July 10, 2006

Date

HIGHFIELDS CAPITAL MANAGEMENT LP

By: Highfields GP LLC, its General Partner

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

HIGHFIELDS GP LLC

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

HIGHFIELDS ASSOCIATES LLC

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

JONATHON S. JACOBSON

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

RICHARD L. GRUBMAN

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title


CUSIP No. 421924101		13G/A		Page 11 of 14 Pages

HIGHFIELDS CAPITAL III L.P.

By: Highfields Associates LLC, its General Partner

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title


CUSIP No. 421924101		13G/A		Page 12 of 14 Pages

EXHIBIT INDEX


Exhibit 1.		Joint Filing Agreement as required by Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, as amended.


CUSIP No. 421924101		13G/A		Page 13 of 14 Pages

Exhibit 1

JOINT FILING AGREEMENT PURSUANT TO RULE 13d-1(k)(1)

The undersigned acknowledge and agree that the foregoing statement on Schedule 13G is filed on behalf of each of the undersigned and that all subsequent amendments to this statement on Schedule 13G shall be filed on behalf of each of the undersigned without the necessity of filing additional joint filing statements. The undersigned acknowledge that each shall be responsible for the timely filing of such amendments, and for the completeness and accuracy of the information concerning him, her or it contained herein, but shall not be responsible for the completeness and accuracy of the information concerning the other entities or persons, except to the extent that he, she or it knows or has reason to believe that such information is inaccurate.

July 10, 2006

Date

HIGHFIELDS CAPITAL MANAGEMENT LP

By: Highfields GP LLC, its General Partner

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

HIGHFIELDS GP LLC

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

HIGHFIELDS ASSOCIATES LLC

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title


CUSIP No. 421924101		13G/A		Page 14 of 14 Pages

JONATHON S. JACOBSON

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

RICHARD L. GRUBMAN

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

HIGHFIELDS CAPITAL III L.P.

By: Highfields Associates LLC, its General Partner

/s/ Joseph F. Mazzella

Signature

Joseph F. Mazzella, Authorized Signatory

Name/Title

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