Australia’s Ramsay Health and KKR-led group cease buyout talks

Trading information for KKR & Co is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, U.S., Aug. 23, 2018. REUTERS/Brendan McDermid/File Photo

Sept 26 (Reuters) – Australia’s Ramsay Health Care (RHC.AX) and a consortium led by KKR & Co (KKR.N) will cease discussions on a non-binding buyout proposal, the hospital operator said on Monday.

The KKR-led consortium first approached Ramsay in April with an A$88 cash per share bid but took it off the table in late August after the company reported a 39% slump in annual profit.

The bid was revised so that 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 (GDSF.PA). Ramsay described the alternative proposal as “meaningfully inferior”.

The consortium recognized that further engagement and access to further due diligence may provide some positive visibility, Ramsay said on Monday.

The consortium noted that Ramsay’s fiscal 2022 results implied there is meaningful downward pressure on the valuation proposed under the alternative proposal.

KKR did not immediately respond to a Reuters request for comment.

Reporting by Harish Sridharan in Bengaluru; editing by Diane Craft

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