HSO) soars after consortium returns with $4.1b bid

Ellerston, headed by former Packer lieutenant Ashok Jacob, is also said to be willing to support a scheme of arrangement in the absence of a superior proposal, subject to an independent expert concluding that the transaction is in the best interests of investors.

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“However, Healthscope has not received any correspondence from Ellerston Capital in relation to the proposal,” Healthscope said.

BGH, which made a $2 billion bid for Navitas this month in a consortium that also includes AustralianSuper, declined to comment on Tuesday. So did Ellerston.

Ms Dwyer will be under pressure to respond at next week’s shareholder meeting to a takeover that is now supported by three of Healthscope’s four largest investors.

Ms Dwyer is facing re-election at the meeting as well as queries from investors about the remuneration report.

Healthscope was forced to issue a statement to the ASX on Tuesday, not long after it announced the latest takeover bid, offering further detail on the key performance indicators that help determine executive bonuses.

“Whilst extensive information about Healthscope’s remuneration framework is contained in the remuneration report in the 2018 annual report, some investors have requested additional detail in relation to the non-financial measures,” it said.

The takeover offer takes advantage of a Healthscope share price that has weakened substantially this month. The stock was trading above $3 two years ago but headed back towards year-lows after the company’s rejection of takeover proposals from BGH and Canadian infrastructure player Brookfield Asset Management in May.

A report from Morningstar badysts on Monday said market concerns around short-term weakness in private health insurance “are unjustifiably weighing on the stock”. It had a valuation on the stock of $2.40.

The BGH consortium lobbed its initial $4.11 billion offer in April before Brookfield came over the top with a $4.35 billion bid.

In May, Healthscope refused to open its books for either bidder, saying both proposals undervalued the company in various areas. Instead, it looked into a sale and leaseback of most of its $1 billion hospital badets, which it confirmed in August would go ahead.

It is understood that this would be a deal breaker for the bidding group, with the timing of the latest offer designed to ensure that the transaction does not go ahead.

The Healthscope board said shareholders did not need to take any action in relation to the proposal at this stage, adding that there was no certainty the proposal would result in a transaction.

“The Healthscope board will badess the proposal and will keep the market informed of any material developments,” the company said.

UBS is acting as Healthscope’s financial adviser and Herbert Smith Freehills is acting as the company’s legal adviser.