Ramsay Health Care Limited (ASX: RHC) has announced it is one step closer to acquiring Europe-based Capio AB.
Ramsay is Australia’s largest private hospital business.
Capio AB operates in five countries: Sweden, Norway, Denmark, France and Germany. Capio also has over 13,000 employees working in hospitals, specialist clinics and primary care units.
For Ramsay, acquiring Capio would expand its European operations substantially. Rask Media covered the initial takeover offer in this article.
The takeover:
Ramsay’s French subsidiary, Ramsay Générale de Santé (RGdS), increased its offer for Capio by 20% to SEK58.0 cash per share. This valued the whole takeover at $1.28 billion, or SEK8,187.
RGdS has secured debt funding and equity funding for the takeover. The Australian-based Ramsay Health Care will fund its portion of the equity funding with $515 million of debt.
In addition to increasing its takeover offer price, RGdS also lowered the required minimum acceptance to just 75% of shareholders.
Ramsay CEO Craig McNally said: “We welcome the unanimous recommendation of the Capio board and look forward to working with shareholders to successfully complete this Offer and subsequently, with the Capio team, to create the leading private health care operator in Europe.”
“Importantly, this transaction is financially compelling, providing the opportunity for substantial synergies for RGdS, as well as further acceleration of Ramsay’s global growth strategy.”
The Ramsay share price is down 15% over the past year according to Google Finance, with Ramsay recently predicting profit growth of 2% in FY19.
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