Australia’s leading private healthcare provider, Healthscope Limited (ASX: HSO) has provided an update on the previously announced proposal from Brookfield Capital Partners Ltd. The proposal is regarding the acquisition of 100% shares of Healthscope by way of a scheme of arrangement, and, if that fails, a simultaneous off-market takeover offer.
In the update, the company has informed that Brookfield is in the process of finalizing its due diligence analysis and debt commitments. Brookfield is planning to seek the necessary internal approvals required to submit a fully documented, entirely financed, binding offer by 31 January 2019. Healthscope has also informed that its engagement with Brookfield is now being conducted on a non-exclusive basis, after the expiry of the exclusivity period on Friday 18 January 2019. After providing the update, the share price of the Healthscope Limited uplifted by 0.209 percent as on 21 January 2019 (AEST 1:08 PM).
This acquisition offer was initially announced on 14 May 2018 when the company informed that it has received a proposal to acquire all the shares of Healthscope Limited through a scheme of arrangement for a cash price of $2.50 per share which was later revised to 2.55 per share and if that failed, a simultaneous off-market takeover offer of $2.42 per share. Further, Healthscope will also be entitled to pay an interim dividend of up to 3.5 cents per share due to which the total value of Takeover Offer was increased to $2.455 per share and Scheme of Arrangement to $2.585 per share.
Following that Healthscope entered into a Process Deed with Brookfield to provide exclusive access to due diligence for a limited period and as per the recent announcement Brookfield has received all the necessary due diligence material from the company.
Today the company has reminded its shareholders that a scheme of arrangement or takeover bid will only proceed if the conditions to the Brookfield Proposal are fully satisfied and if a binding implementation agreement is executed by the parties. The company has also reminded its shareholders that as of now it is not sure that the Proposal will result in a scheme of arrangement or a takeover bid.
In FY 2018, the group revenue increased by 3.7 percent to $2,340.8 million as compared to FY 2017. The Hospitals revenue increased by 4.3 percent and New Zealand Pathology revenue was down by 1.0% in FY 2018 as compared to FY 2017. The Group Operating EBIT decreased by 7.8% to $265.9 million in FY 2018 as compared to FY 2017. In FY 2019 the company is expecting its Hospital Operating EBITDA to grow by around 10 percent compared with FY 2018.
Meanwhile, in the last six months, the share price of the company increased by 9.13 percent as on 18 January 2019. HSO’s shares traded at $2.395 with a market capitalization of circa $4.16 billion as on 21 January 2019 (AEST 1:08 PM).
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