Archive | Acurity

Vital’s Boulcoutt buy gets Evolution out of a bind

Vital Healthcare Property Trust said on 24 December it had conditionally acquired the freehold real estate at Boulcott Private Hospital in Lower Hutt from Evolution Healthcare (NZ) Pty Ltd, with a 22-year lease to ASX-listed Pulse Health Group in place.

In September, the Commerce Commission had rejected Evolution’s bid to acquire all the shares in Austron Ltd unless it sold Boulcott, one of a series of commission decisions preventing 3 of the 4 private hospitals in the Wellington region – Boulcott, Bowen & Wakefield – coming under common ownership, leaving only Southern Cross Hospital independent of Evolution & Connor Healthcare Ltd.

Austron, owned by the Royston Health Trust Board & Medusa Ltd, is the majority owner of Connor Ltd, which in turn owned the Bowen & Wakefield private hospitals. Evolution (NZ), part of the Sydney-based Evolution Healthcare Group, held a minority stake in Connor.

Vital will acquire Boulcott for $30.7 million at an initial yield of 6.85%, and separately acquire an adjacent residential property for $1 million for future development. Settlement is expected following receipt of regulatory approvals, which Vital anticipates will be in mid-2016.

Boulcott is a 38-bed private surgical hospital with 3 operating theatres, 29 inpatient beds, a 9-bed day surgery suite and an endoscopy unit. About 45 specialist consultants & surgeons provide services across a range of surgical specialties, including orthopaedics, ophthalmology & urology services. Boulcott is directly adjacent to Hutt Hospital, and will become Vital’s first New Zealand asset co-located with a public hospital.

Vital Healthcare Management Ltd chief executive David Carr said: “Boulcott directly aligns with our stated scale & diversification strategy and complements the growth we have experienced in Australia. We have prudently sought to acquire high quality healthcare assets in New Zealand in recent years and Boulcott delivers on that.”

Earlier stories:
22 September 2015: Evolution gets conditional clearance to buy Austron
1 April 2015: Connor appeals initial rejection of Acurity bid
23 December 2014: Acurity bid unconditional
22 December 2014: Undertaking changes commission’s mind on Acurity takeover
12 December 2014: Commission rejects full Acurity takeover

Attribution: Company release.

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Evolution gets conditional clearance to buy Austron

The Commerce Commission has cleared Evolution Healthcare (NZ) Pty Ltd to acquire all the shares in Austron Ltd, subject to Evolution selling Boulcott Hospital in Lower Hutt.

It’s the third application for clearance the commission has considered involving these parties and the supply of private hospital services in Wellington.

Austron, owned by the Royston Health Trust Board & Medusa Ltd, is the majority owner of Connor Ltd, which in turn owns the Bowen & Wakefield private hospitals in Wellington. Evolution Healthcare (NZ) is part of the Sydney-based Evolution Healthcare Group, owning Boulcott Hospital and a minority stake in Connor.

Evolution’s acquisition of Austron would result in Evolution owning 3 of the 4 private hospitals in Wellington, with Southern Cross Hospital the only independent competitor. However, Evolution has given the commission an undertaking to divest the business & assets of Boulcott Hospital to an independent party which must be approved by the commission.

Commission chair Mark Berry said: “The commission is satisfied that subject to the undertaking, the acquisition will not have, or would not be likely to have, the effect of substantially lessening competition in any of the affected markets.

“Evolution’s undertaking to divest its interest in Boulcott Hospital will return the market to its pre-acquisition structure, with 3 competitive options for health insurers, ACC & patients.”

On 11 December, the commission declined an application from Connor to acquire the rest of Acurity Health Group Ltd. But, 6 days later, the commission reversed its decision, subject to an undertaking that Evolution reduce its shareholding in Acurity to pre-acquisition levels.

Earlier stories:
1 April 2015: Connor appeals initial rejection of Acurity bid
23 December 2014: Acurity bid unconditional
22 December 2014: Undertaking changes commission’s mind on Acurity takeover
12 December 2014: Commission rejects full Acurity takeover

Attribution: Commission release.

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Connor appeals initial rejection of Acurity bid

Connor Healthcare Ltd said yesterday it had filed an appeal in the High Court against the Commerce Commission’s decision declining clearance for it to acquire all the shares in Acurity Health Group Ltd it did not already own.

The commission declined Connor’s clearance application because its parent company, Evolution Healthcare (NZ) Pty Ltd, would have increased its interest in Acurity as a result of the merger.

The proposed acquisition would have seen 3 of the 4 private hospitals in the Wellington region – Boulcott, Bowen & Wakefield – come under common ownership, leaving only Southern Cross Hospital independent of Connor. The commission considered this would have resulted in some medical procedures only being available at the merged healthcare providers, removing a competitive constraint.

Connor subsequently made a second application for clearance to acquire all the shares in Acurity, subject to a divestment undertaking which meant Evolution’s interest in Acurity would remain at the same level as it was before the acquisition. The commission cleared this second application.

Connor’s appeal relates only to the first decision.

Earlier stories:
23 December 2014: Acurity bid unconditional
22 December 2014: Undertaking changes commission’s mind on Acurity takeover
12 December 2014: Commission rejects full Acurity takeover

Attribution: Commission release.

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Acurity bid unconditional

Connor Healthcare Ltd went unconditional yesterday on its takeover offer for Acurity Health Group Ltd after getting Commerce Commission clearance on Friday for its bid, and issued a compulsory acquisition notice to the holders of the remaining 2.4% of shares.

Connor made its $7.25/share takeover offer in August and held more than 97% of Acurity when the offer closed on 21 November. However, the Commerce Commission rejected the offer because it would result in 3 of the 4 private hospitals in the Wellington region falling under common ownership.

The commission relented when Connor gave an undertaking that Evolution Healthcare (NZ) Pty Ltd, owner of one of those hospitals and 25% owner of Connor, would reduce its Connor stake to 11.7% within a month.

Shareholders who have accepted Connor’s offer will be paid today and the compulsory acquisition period for the rest will run until 19 January.

Acurity’s taxable bonus issue has also gone unconditional, to be allotted this morning. Those shares will also be transferred to Connor.

Attribution: Company release.

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Undertaking changes commission’s mind on Acurity takeover

The Commerce Commission gave Connor Healthcare Ltd clearance on Friday to take over Acurity Health Group Ltd, subject to Evolution Healthcare (NZ) Pty Ltd divesting shares in Connor after the takeover.

Evolution owns 100% of Connor, and the commission’s new decision followed rejection of Connor’s proposed takeover a week earlier, which would have seen 3 of the 4 private hospitals in the Wellington region fall under common ownership.

The effect of the divestment condition is that Evolution’s interest in Acurity will remain at the same level as it was before the acquisition, maintaining the status quo while allowing the takeover of Acurity to proceed.

When Connor’s takeover formally closed on 21 November, acceptances combined with its existing holding exceeded 97%. It had Overseas Investment Office approval for the takeover, and Commerce Commission clearance was the only remaining obstacle.

NZX-listed Acurity (ex-Wakefield Health Ltd) owns & operates the Wakefield & Bowen hospitals in Wellington and Royston in Hastings. Evolution owns Boulcott Hospital in Lower Hutt.

Pre-bid, Connor owned 11.7% of Acurity. Post-takeover, Connor would hold 100% of Acurity, Evolution would hold 25% of Connor and Austron Ltd would hold the remaining 75%.

However, Connor & Evolution have given the commission an undertaking that within one month of the takeover being complete, Evolution will reduce its shareholding so it effectively returns to its pre-acquisition level of an 11.7% interest in the company that owns Wakefield & Bowen hospitals, which will then be Connor. The parties will also make changes to Connor’s.

Connor has until the close of business today to declare the offer unconditional in all respects. The taxable bonus issue that Acurity first announced on 14 November remains conditional on receipt of that confirmation.

Earlier story:
12 December 2014: Commission rejects full Acurity takeover

Attribution: Commission release.

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Propbd on Q Th18Dec14 – 6 units sell, council plan decision, Augusta syndicate, 2 units sell, commercial sales, Acurity bid

6 units sell & 2 under negotiation at Ray White auction
Council long-term plan adopted for consultation
Augusta adds to Brisbane portfolio
2 units sell at City Sales auction
GDP up 1% for quarter
Old Ponsonby fire station among 4 commercial sales, apartment sector quiet
Connor makes new bid for Acurity

2.40pm:
6 units sell & 2 under negotiation at Ray White auction

Ray White City Apartments sold 6 units under the hammer today at its final auction of the year, and was negotiating on sale of the other 2 properties on the list.

The auction ended with a flurry of bidding on each of 2 units in the Oaks on Hobson, next to the central police station, both bought by the same investor. Auction results:

Quay West, 8 Albert St, unit 1701, postponed to 29 January, sales agent Victor Liu
Carlaw, 30 Heather St, unit GE, sold for $572,000, Dominic Worthington
Imperial Gardens, 135 Hobson St, unit 916, sold for $210,000, Victor Liu
Bianco, 2 White St, unit 6E, sold for $225,000, Damian Piggin & Daniel Horrobin
Brownstone, 55 Mahuhu Crescent, unit 5, passed in at $430,000, Lorraine Garnett
Fiore, 152 Hobson St, unit 305, passed in at vendor bid of $320,000, Adele Keane & Krister Samuel
Eden Terrace, 121 Newton Rd, unit 2F, sold for $365,000, Donald Gibbs
Oaks on Hobson, 188 Hobson St, unit 102, sold for $162,000 + gst, Dominic Worthington
Oaks on Hobson, 188 Hobson St, unit 206, sold for $168,500 + gst, Dominic Worthington

Council long-term plan adopted for consultation

Auckland Council adopted its 2015-25 long-term plan for consultation today, approved an outdoor fire safety bylaw and also approved going to consultation on a much larger injection of functions Maori transformational shifts.

The meeting closed with a confidential recommendation on deferrals from tranche 4 of the special housing areas designated under the housing accord with the Government, and proposals for new areas.

The big change in the long-term plan consultation document will be the inclusion of the full range of options for the council’s uniform annual general charge – from zero to the maximum allowable of $900 – part of the rates bill.

The recommendation for the uniform charge is $385/residential property. Right-wing councillors argued unsuccessfully at committee level for a charge of $550, and argued today that the options for consultation should be wider than the 3 staff presented, the highest being $500.

Financial planning, policy & budgeting manager Matthew Walker said it would be possible to include the full range from zero-$900, but that wouldn’t be ready for the start of the consultation process.

Augusta adds to Brisbane portfolio

Augusta Funds Management Ltd has bought a Brisbane industrial property for $A6.13 billion for syndication to eligible & exempt investors through a limited liability partnership.

Minimum investment is $A200,000 in $A50,000 parcels.

The property at lot 7, 121 Evans Rd, Salisbury, has an 8275m² office & industrial building on it and is leased to Orrcon Manufacturing Pty Ltd until 17 March 2020, with a further 5-year renewal period.

Gearing would be 48.1% based on the purchase price and 47.6% based on a valuation of $A6.2 million.

Links to stories posted earlier today:

2 units sell at City Sales auction

GDP up 1% for quarter

Old Ponsonby fire station among 4 commercial sales, apartment sector quiet

Connor makes new bid for Acurity

Attribution: Auctions, company release, Statistics NZ.

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Connor makes new bid for Acurity

Connor Healthcare Ltd has made a new bid for Commerce Commission clearance for its quest to buy 100% of Acurity Health Group Ltd after the commission rejected its first application last week.

The proposal has some complicated ownership structure to it. Acurity would be 100% owned by Connor Healthcare, and for a short period of time Connor Healthcare would be owned 75% by Austron Ltd (the current owner of 50% of Acurity) and 25% by Evolution Healthcare Ltd.

Evolution Healthcare owns 100% of Connor Healthcare and has undertaken to sell down its shareholding in the interim period, returning it to the equivalent of the 11.7% shareholding in Acurity it currently owns. Connor Healthcare would then be owned 88.3% by Austron and 11.7% by Evolution.

The Commerce Commission said last week the takeover would see 3 of the 4 private hospitals in the Wellington region fall under common ownership.

When Connor’s takeover formally closed on 21 November, acceptances combined with its existing holding exceeded 97%. It had Overseas Investment Office approval for the takeover, and Commerce Commission clearance was the only remaining obstacle.

Earlier story:
12 December 2014: Commission rejects full Acurity takeover

Attribution: Commission release.

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Commission rejects full Acurity takeover

The Commerce Commission has declined Connor Healthcare Ltd’s application make a full takeover of Acurity Health Group Ltd because it would see 3 of the 4 private hospitals in the Wellington region fall under common ownership.

When Connor’s takeover formally closed on 21 November, acceptances combined with its existing holding exceeded 97%. It had Overseas Investment Office approval for the takeover, and Commerce Commission clearance was the only remaining obstacle.

Connor Healthcare is 100% owned by Evolution Healthcare Ltd, which also owns Boulcott Hospital in Lower Hutt.

NZX-listed Acurity (ex-Wakefield Health Ltd) owns & operates the Wakefield & Bowen hospitals in Wellington and Royston in Hastings.

The proposed takeover would leave only Southern Cross Hospital independent of Connor Healthcare.

Commission chairman Mark Berry said yesterday the commission wasn’t satisfied that the proposed acquisition wouldn’t, or wouldn’t be likely to, substantially lessen competition in respect of a number of medical procedures performed in private hospitals in the greater Wellington region.

“Boulcott Hospital provides an important competitive constraint to the other hospitals in the Wellington region. For medical insurance providers, the greater the number of hospitals they have to play off against each other, the more competitive the price they will achieve, which ultimately benefits consumers. If the acquisition proceeded, insurers would have had one less option and, for some procedures, Connor Healthcare would have been the only significant provider in the greater Wellington region.

“For some of the procedures, we believe Southern Cross Hospital would be unable to expand to a sufficient extent to replace the competition that would be lost. The greatest difficulty Southern Cross Hospital would be likely to face, apart from enough physical capacity, would be attracting sufficient specialists to its facilities to perform procedures.”

Link: Clearances register, Acurity page (this decision not added yet)

Attribution: Commission release.

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Partial takeover bid for Acurity (ex-Wakefield) nears fulfilment

Published 24 August 2012

Austron Ltd’s partial takeover of Acurity Health Group Ltd (ex-Wakefield Health Ltd) is most of the way to completion despite the independent directors’ recommendation against it.

 

The independent directors recommended last Friday that shareholders shouldn’t accept the 50.01% partial takeover offer through Austron by the target company’s 2 largest shareholders, Royston Hospital Trust Board & Medusa Ltd.

 

The independent directors said the $6/share offer, which must remain open until Thursday 6 September, represented a 25% premium over the closing price on 8 August, the day before the offer was made, but was materially below the independent advisor’s assessed value range of $6.92-7.88 (with a mid-point of $7.40).

 

However, by Wednesday, Austron had acceptances representing 45.89% of Acurity’s shares.

 

Earlier story:

20 August 2012: Acurity (ex-Wakefield) independent directors reject bid price

 

Want to comment? Go to the forum.

 

Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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Acurity (ex-Wakefield) independent directors reject bid price

Published 20 August 2012

The independent directors of Acurity Health Group Ltd (ex-Wakefield Hospital Ltd) recommended on Friday that shareholders shouldn’t accept the 50.01% partial takeover offer by Austron Ltd.

 

Austron is owned by Acurity’s 2 largest shareholders, Royston Hospital Trust Board & Medusa Ltd.

 

The independent directors said the $6/share offer, which must remain open until Thursday 6 September, represented a 25% premium over the closing price on 8 August, the day before the offer was made, but was materially below the independent advisor’s assessed value range of $6.92-7.88 (with a mid-point of $7.40).

 

The independent directors said shareholders shouldn’t accept it “unless they have a short-term objective to realise the certainty of some cash now”.

 

To comply with its Takeovers Code obligations, Acurity has included in the target company statement an update on its financial performance since 31 March, which showed that for the 4 months to July total revenue was up 0.7%, ebitda was down 16.5% and adjusted net profit after tax (excluding interest rate swap revaluations) was down 25.9%. However, Acurity noted that significant month-on-month fluctuations had been the norm for at least 3 years and that ebitda & adjusted net profit after tax improved in the last 2 months compared to last year.

 

Want to comment? Go to the forum.

 

Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

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