RE:RE:RE:$2 Billion Australian Healthcare Real Estate Joint VentureHey Northcoast and anyone else.
Any insight on the Healtscope Australia (HSO.AX) annoucement and how it may be linked with NWH.UN ??? Sounds like everytjing HEALTHSCOPE is doing is wrong and should have accepted Brookfields offer to buy back in May 2018.
Sounds like a potential buyng opportunity for NWH.UN at a reduced rate. But is it worth it?
By Byron Kaye and Tom Westbrook
SYDNEY, Aug 21 (Reuters) - Australian hospital operator
Healthscope , which recently rejected two takeover
approaches, plans to inject A$1 billion ($731.6 million) of its
property assets into a trust and sell nearly half of that to an
investor.
The move will help Healthscope make the best of buoyant
commercial real estate prices and free up cash as a costly
hospital expansion program, shrinking patient demand and cuts to
private health insurance payouts weigh on its profits and
shares.
Healthscope, the country's No. 2 private hospital group,
also said in a statement on Tuesday that annual operating profit
halved, as expected.
The company's stock has dropped 16 percent since it rejected
the two $3 billion-plus offers in May and has lost a third of
its value since its peak in September 2016. [nL3N1SS5HC]
Healthscope said the new real estate trust would hold its 29
fully owned hospitals. These would be leased back to the parent
company, which would own a majority stake in the trust, while it
will seek an investor who would hold up to 49 percent.
"This structure increases the operating leverage at a
challenging time for the private hospital sector," JP Morgan
analysts said in a research note.
Healthscope - which rejected buyout offers from Canada's
Brookfield Asset Management and a consortium of local
private equity firm BGH Capital and 14 percent shareholder
AustralianSuper - did not elaborate if it was in talks with
interested parties.
"It will preserve Healthscope's control and management
rights over our hospitals, as well as our operating flexibility
to continue to deliver on their growth potential," Chairman
Paula Dwyer said in the statement.
The company said it will pass on proceeds from the sale to
shareholders. JP Morgan analysts said the company might sell the
49 percent stake for A$800 million.
Brookfield, BGH and AustralianSuper declined to comment.
A spokesman for Canadian landlord NorthWest Healthcare
Properties REIT , which bought a tenth of Healthscope
in May, said the company wants to see the details of
Healthscope's proposal before commenting.
In July, Healthscope sold its Asian pathology business
comprising 39 laboratories to TPG Capital Management LP [TPG.UL]
for A$279 million. [nL4N1UP0R3]
Healthscope shares were up 0.5 percent on Tuesday afternoon,
while the broader market .AXJO> was down 0.9 percent.
($1 = 1.3669 Australian dollars)
(Reporting by Byron Kaye and Tom Westbrook in SYDNEY;