Fortis Global Healthcare has announced that it will acquire a majority stake in Australia’s largest dental healthcare chain Dental Corporation Holdings Limited (DCH), in which it bought 30% stake two months back for Rs 450 crore. The move to take over Dental Corporation comes barely a week after it said it has acquired a Singapore -based under-construction specialised cancer hospital for Rs 115 crore.
Under the fresh takeover bid, Fortis has agreed to make an offer to each DCH shareholder to acquire up to 30% of their existing shareholding at a price of $2.54 per share. FGH has also agreed to make separate offers to acquire 30% of the employee options held by DCH option holders.
The offer values DCH at approximately $400 million and represents an 18% premium over the price which Fortis paid for 30% stake DCH in December 2010.
Fortis currently owns 16.7million DCH shares and holds a loan repayable by the issue of 31.4 million DCH shares. This would result in Fortis owning approximately 33% of DCH. Depending on the level of acceptances under the offer, Fortis will acquire between 25.8 million and 51.7million shares in DCH representing between 12.5% and 27.7% of the fully diluted equity. This will take Fortis's shareholding to between 43.4% and 58.6% of DCH.
DCH directors unanimously support the Proportional Offer and recommend that DCH shareholders accept the Proportional Offer, in the absence of a superior proposal and an independent expert concluding that the Proportional Offer is fair and reasonable.
“We welcome the Proportional Offer from FGH which was flagged at the time of the initial investment in DCH by FGH in December 2010. The Proportional Offer provides our shareholders with an opportunity to realise some of their investment in DCH in cash while maintaining the majority of their shareholding,” Mark Evans, Executive Chairman of DCH said.
Dental Corporation is the largest dental healthcare provider, offering premium dental practices across Australia and New Zealand with annualised revenue of over A$250 million (Rs 1,140 crore) and having an existing network of 139 dental practices across Austraia and New Zealand.
“Fortis looks forward to continuing to support the DCH management team to deliver the company’s growth forecasts in Australia and New Zealand and potentially into new geographies in Asia. This investment is the next step in the development of the relationship between DCH and Fortis,” Malvinder Singh, Chairman of Fortis and a director of DCH said.
Fortis Global Healthcare became the largest primary healthcare provider in Hong Kong in October 2010 after announcing its acquisition of Hong Kong-listed Quality Healthcare Asia Ltd (QHA) for about Rs 882 crore, which came after Fortis’ failed attempt to acquire Singapore based Parkway Holdings