Mediclinic mulling amended offer for Spire

Mediclinic updated the market on its ongoing efforts to acquire Spire Healthcare on Thursday, confirming it would consider share price movements in recent weeks before possibly making an amended offer.

The FTSE 100 company had confirmed that it made a proposal to Spire to acquire all of the issued and to-be-issued share capital of Spire it did not already own on 23 September.

Its initial proposal comprised 150p in cash and 0.232 new Mediclinic shares per Spire share.

Based on the closing price of Mediclinic shares of 645.5p as at 17 October, the initial proposal valued each Spire share at 300p.

As noted by Spire, the initial proposal was rejected by the independent directors of Spire.

“Although discussions have continued, no agreement has yet been reached on any of the key terms of an offer,” Mediclinic’s board said in its statement on Thursday.

“Mediclinic takes a highly disciplined approach to capital allocation and is focused on ensuring that any offer it makes for the remaining share capital of Spire is in the best interests of Mediclinic shareholders.

“Accordingly, Mediclinic considers it appropriate to take into account the movement in its share price since 17 October 2017 when considering its position.”

In accordance with the Code, Mediclinic will be required to either announce a firm intention to make an offer for Spire or announce that it does not intend to make an offer by no later than 1700 GMT on 20 November.

That deadline could only be extended with the consent of the UK Takeover Panel, although Mediclinic said it understood that the panel “will normally consent” to such an extension at the request of Spire.

Mediclinic noted that it reserved the right to vary the form and mix of the offer consideration, and vary the transaction structure.

“Mediclinic also reserves the right to amend the terms of any offer - including making the offer at a lower value - with the recommendation or consent of the Spire Board; if Spire announces, declares or pays any dividend or any other distribution or return of value to shareholders, in which case Mediclinic reserves the right to make an equivalent reduction to its proposal; following the announcement by Spire of a whitewash transaction pursuant to the Code; or if a third party announces a firm intention to make an offer for Spire at a lower price than referred to above.”

The company’s board said a further announcement would be made in due course, adding that there could be “no certainty” that an offer would be made.

Mediclinic also posted its interim results on Thursday, confirming its revenue was ahead while earnings results were mixed.