Sirtex Medical Limited
Update Regarding Removal of SRX stock from the S&P/ASX 200 Index & Adjournment of shareholder meeting: Biotechnology and Medical device company, Sirtex Medical Limited (ASX: SRX) has postponed the scheme meeting to vote on the proposed acquisition by Varian Medical Systems, Inc. to a date that will be determined later. As a result, SRX stock will not be removed from S&P/ASX 200 effective May 11, 2018 and IDP Education Limited stock will no longer be added to replace SRX in the S&P/ASX 200 effective May 11, 2018. On the other hand, SRX had received an unsolicited non-binding, indicative and conditional proposal from CDH Investments (CDH, a Chinese asset manager) to acquire 100% of SRX for a cash price of A$33.60 per share. However, this is subject to number of conditions. As of now, the Federal Court has made orders for postponing the Scheme Meeting to a date to be determined on the proposed takeover of the company by Varian Medical Systems. Therefore, SRX will make a further announcement about the proposed date, time and location of the postponed Scheme Meeting in due course. It is worth noting that CDH Investments proposed a counter bid to acquire all of SRX shares at a price of $33.60 per share, which is a 20% improvement on the offer from Varian Medical. Meanwhile, SRX stock has risen 6.40% in three months as on May 04, 2018. Based on the foregoing, we give a “Hold” recommendation on the stock at the current price of $ 29.200.
Healthscope Limited
Received unsolicited and conditional acquisition proposal: Up 23% in last six months (as at May 04, 2018), Healthscope Ltd (ASX: HSO) received an unsolicited proposal from a consortium of financial investors to acquire all of the shares in HSO through a scheme of arrangement. The proposal is stated to be a preliminary, non-binding indication of interest. The indicative price for the acquisition is of $2.36 cash per share, which is a premium of 16% to the closing share price of A$2.03 on 24th April 2018. However, the indicative price will be reduced by the value of any dividends or other distributions declared, proposed or paid. Further, the proposal is subject to a significant number of conditions. The consortium of financial investors comprises of the constituent entities of BGH Capital, AustralianSuper, Carob Investment Private Limited, Ontario Teachers’ Pension Plan Board, and Canada Pension Plan Investment Board. One member of the consortium, AustralianSuper, already has a holding of approximately 14% in HSO. Meanwhile, there is no certainty that the proposal will result in a transaction. As of now, we give a “Hold” recommendation on the stock at the current price of $ 2.400.
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