It seems like things are shaping up for Healthscope Limited (ASX: HSO) which is regarded as the leader in the businesses of private hospitals within the Australian boundaries. The leading private hospital came forward and made an announcement that BGH-AustralianSuper Consortium has again come up with another offer for the takeover. The consortium which is being handled by BGH capital and AustralianSuper had earlier also approached Healthscope for the takeover but Healthscope turned that offer down.
Healthscope stated that largely the offer from the BGH-AustralianSuper led consortium is same which was made earlier as they have approached with no change in the offer price. This offer price has been fixed at $2.36 per share. However, the success is not guaranteed as the offer which has been made is a non-binding indication of interest as well as preliminary. The offer also comes with several conditions like debt arrangement for the execution of acquisition, due diligence, operational and regulatory conditions as well as the approval from consortium’s members to be received in regard to the investment committee.
The consortium which plans to takeover also stated that Healthscope would not be unloading any of the property assets, to try and achieve profit growth of 10% in FY 2019 as well as Healthscope’s debt in the balance sheet is in line with the results for FY 2018. Healthscope’s shareholder, Ellerston Capital, has stated that it would be helping Healthscope in respect of the due diligence as well as that it would help this takeover offer.
If this new takeover deal gets through, AustralianSuper plans to make additional deployment amounting to approximately $1 billion. Notably, Healthscope has been seeking the advisory services from the UBS while legal counselling services would be advanced by Herbert Smith Freehills. BGH/AustralianSuper would be advised by Macquarie.
What’s about the offer which HSO received earlier?
Healthscope has received the takeover offer earlier also and the consortium of investors was planning to buy all the shares of leading private hospital in Australia. The lists of investors include BGH Capital Fund, AustralianSuper, Ontario Teachers’ Pension Plan Board, Carob Investment Private Limited as well as Canada Pension Plan Investment Board. At that time, Healthscope stated that AustralianSuper had been on holding circa 14% stake in Healthscope. During that time also, the conditions for the acquisition were (but not limited to) debt arrangement to finance the proposed acquisition as well as due diligence.
The conditions are pretty much same. Earlier, the consortium is of the view that Healthscope need not to sell the assets which include Asian pathology business and Healthscope stated that deal might not convert to the takeover. However, the deal was abandoned by Healthscope.
The stock price of Healthscope Limited has been witnessing a strong upward movement as a result of the news of the takeover. At the time of writing, the stock price is trading at A$2.120 per share which implies an intraday rise of A$0.335 or 18.768%. The company has an annual dividend yield of 3.75% and the market capitalization of $3.11 billion as on October 23, 2018.
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