Australia's Ramsay Health Rejects KKR's 'Meaningfully Inferior' Alternative Buyout Proposal

Australia's Ramsay Health Rejects KKR's 'Meaningfully Inferior' Alternative Buyout Proposal
  • Earlier, Australia-listed Ramsay Health Care received an all-cash deal at $88/share from KKR & Co KKR led consortium.
  • The consortium has requested the Ramsay Santé board of directors for due diligence. However, there’s no guarantee that the Paris-listed firm, in which Ramsay Health owns 52.8%, will grant access to the suitors.
  • Now KKR is no longer talking about a whole company all-cash deal.
  • Instead, KKR’s been chipping away with an alternative proposal.
  • The alternative would see KKR acquire 100% of the shares in Ramsay via a scheme of arrangement and spin the bulk of Ramsay’s Sante stake back to investors.
  • Small parcel holders with less than 5000 shares would get $88 a share, paid entirely in cash.
  • Everyone else would get $78.20 cash and 0.22 Sante shares for every Ramsay share.
  • Based on Sante’s most recent close, the alternate proposal would be valued at $84.93/share.
  • “The Ramsay board has considered the alternative proposal and is unanimous of the view that it is meaningfully inferior,” it said in the statement. “The board has determined not to engage further with the consortium in relation to the alternative proposal on these terms.”
  • Ramsay will continue to engage with the KKR-led group on the original proposal, and no certainty will result in a transaction.
  • Price Action: KKR shares closed at $53.16 on Wednesday.

Posted In: BriefsLarge CapM&ANewsHealth CareHedge FundsGeneral