Is Healthscope about to give up its battle to remain independent? It yesterday offered exclusive due diligence to Brookfield Capital Partners after the Canadian-led investor group returned to the table with a takeover offer worth up to $4.5 billion.
Private hospital operator Healthscope has responded to the pressure from two unwanted takeover offers from private equity and decided it will sell its Asian pathology business for $279 million to entities controlled by funds managed by TPG Capital Asia.
Healthscope intends to close Geelong and Cotham private hospitals in Victoria and take an impairment on Frankston Private. The company has also lowered FY18 guidance and signalled 10% growth in hospital operating earnings in FY19.
The broker retains a Buy rating and $3.00 target on Healthscope, noting recent industry data implies low structural risk for the company’s $800m+ Mona Vale hospital project, which is ahead of schedule.