KKR Scraps A$14.5B Takeover Bid Of Australia's Ramsay Health Care

  • Talks regarding KKR & Co KKR-led consortium buying Australian hospital operator Ramsay Health Care Ltd RMSYF RMYHY have fallen apart.
  • The consortium sent a letter reconfirming it would not offer A$88 a share and could not increase its alternative proposal.
  • In April this year, a KKR-led consortium offered to buy Ramsay Health Care Ltd for roughly $14.9 billion.
  • The bid was revised so Ramsay shareholders would be entitled to A$88 per share as in the all-cash proposal but only for the first 5,000 shares.
  • For investors with larger stakes, the offer was split into A$78.20 per share in Ramsay and 0.22 share in French subsidiary Ramsay Generale de Sante. Ramsay described the alternative proposal as "meaningfully inferior."
  • Ramsay's board wanted KKR to increase its offer. However, KKR and its co-investors cited reviewing Ramsay's FY22 result implying downward pressure on valuations. They noted that it is not in a position to improve the terms of the Alternative Proposal.
  • The letter also stated that if Ramsay Board is willing to reset valuation expectations and consider a new proposal, the consortium will move quickly to discuss mutually acceptable terms.
  • Ramsay said it had yet to consider the group's response, noting "there is no certainty that any further proposal will be forthcoming or that any proposal would result in a transaction."
  • Ramsay shares on the Australian stock exchange fell almost 11%.
  • Price Action: KKR shares closed higher by 2.29% at $52.68 on Monday.
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