Healthscope Limited

Received unsolicited and conditional acquisition proposal: Healthscope Limited’s (ASX: HSO) stock climbed up 14.778 per cent on April 26, 2018 post announcement on receiving an unsolicited proposal from a consortium of financial investors to acquire all of the shares in Healthscope by way of a scheme of arrangement. According to the announcement, the preliminary, non-binding proposal has an indicative offer price of $2.36 cash per share, representing a premium of 16.0% to the closing share price of $2.03 on April 24. The consortium of financial investors comprises the constituent entities of BGH Capital Fund I, AustralianSuper, Carob Investment Private Limited, Ontario Teachers’ Pension Plan Board and Canada Pension Plan Investment Board. One of the member of this consortium, AustralianSuper currently has a holding of approximately 14% in Healthscope. The proposal is subject to a significant number of conditions including due diligence, arrangement of debt financing for the acquisition, negotiation and execution of a Scheme Implementation Deed, and receipt of all necessary regulatory approvals, etc. Further, Healthscope shareholders do not need to take any action in relation to the proposal at this stage. Moreover, the management has advised shareholders to take no action in relation to the proposal and informed that there is no certainty that the proposal will result in a transaction. However, Hospitals’ operating EBITDA projection for FY18 remains unchanged, which is expected to be broadly like FY17.


1HFY18 Operating EBITDA Contribution (Source: Company Reports)

On the other hand, BGH Capital Pty Ltd (BGH), Canada Pension Plan Investment Board (CPPIB), GIC Private Limited (GIC), Carob Investment Private Limited (Carob), GIC Special Investments Pte Ltd (GIC SI) and GIC (Ventures) Pte Ltd (GIC Ventures), Ontario Teachers’ Pension Plan Board and their respective entities, became the substantial holder of Healthscope Limited by holding 252,643,305 securities with 14.52 per cent of the voting power. We give a “Hold” recommendation on the stock at the market price of $ 2.330.

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