Private equity and Australia’s biggest super fund just lobbed another $4.1 billion takeover bid for Healthscope

  • Healthscope, Australia’s second biggest private hospital operator, just received another $4.1 billion takeover bid.
  • The offer is from a consortium headed by BGH Capital and industry fund AustralianSuper.
  • The proposal for a scheme of arrangement is backed by Ellerston Capital which has 9.3% of Healthscope.

Private hospital operator Healthscope has received a $4.1 billion takeover bid from a consortium headed by BGH Capital and industry fund AustralianSuper.

Australia’s second biggest private hospital operator says the proposal is substantially the same as one made in April that was rejected by Healthscope.

The latest proposal specifies an indicative price of $2.36 cash share.

A short time ago, Healthscope shares were up almost 19% to $2.12.

The consortium says Ellerston Capital, which has 9.3% of Healthscope, has said it will support a scheme of arrangement in the absence of a superior proposal.

However, Healthscope says it hasn’t received any correspondence from Ellerston Capital about the proposal.

AustralianSuper has a shareholding of about 14% in Healthscope.

The offer is subject to a long list of conditions, including due diligence and arranging debt financing for the acquisition.

“The Healthscope Board will assess the proposal and will keep the market informed of any material developments in accordance with its continuous disclosure requirements,” the company says.

“Healthscope shareholders do not need to take any action in relation to the proposal at this stage. There is no certainty that the proposal will result in a transaction.”

UBS is acting as financial adviser to Healthscope and Herbert Smith Freehills as legal adviser.

A deal would represent a return to private equity for Healthscope, which was formerly owned by TPG and The Carlye Group.

Healthscope has 45 hospitals, pathology operations across New Zealand, Malaysia, Singapore and Vietnam, and 18,000 employees.

The company in August posted a 3.7% rise in full year revenue to $2.34 billion. Net profit after tax was down by 50% to $75.8 million after the closure of some under-performing hospitals, the sale of medical centres and its Asian Pathology businesses.

BGH Capital and AustralianSuper are also in a joint $2 billion bid for educational services providers Navitas.