By Stuart Condie
SYDNEY--Ramsay Health Care Ltd. has made an all-cash offer for U.K. rival Spire Healthcare Group PLC, a move that the Australian hospital operator said will create a leading U.K. service provider.
Ramsay on Wednesday said Spire's board had unanimously recommended shareholders accept its offer of GBP2.40 (US$3.40) a share, which implies a company enterprise value of GBP2.06 billion. Shares in Spire last traded at GBP1.93.
Ramsay said the acquisition would be funded by existing debt facilities and may require the divestment of some U.K. assets to gain approval from U.K. regulators. Ramsay said it will engage in one or both of capital management and a strategic review following the acquisition, which it expects to close in July.
It has already secured undertakings to vote in favor of the scheme from shareholdings representing about 30.4% of Spire's issued share capital.
Ramsay said the acquisition of Spire's 39 hospitals and eight clinics would be transformational, diversifying the Australian company's payer sources and expanding its geographic reach. The combined group wil target self-pay and insured patients to address demand from a public health waiting list that stood at 5 million patients in March.
"The transaction will also create the platform to address the growing patient demand for more convenient healthcare through increased investment in digital innovation and transformation," Chief Executive and Managing Director Craig McNally said.
Ramsay said it had already identified GBP26 million in annual savings.
Ramsay shares closed 0.7% lower at A$64.54 (US$50.04), up 3.8% for 2021.
Write to Stuart Condie at firstname.lastname@example.org
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