Ahead of the Curve – Strong Overseas Interest in Local Healthcare

8 January 2019

In yet another sign of the very strong state of the Australian healthcare sectior. Healthcare conglomerate Healius has rejected a $2 billion takeover offer from China’s Jangho Group on the basis it “is opportunistic and fundamentally undervalues” the company.

The Sydney-based company, which was previously called Primary Health Care, said it has a number of improvement initiatives underway that, once completed, will deliver value to shareholders “in excess of” the proposal that Jangho lobbed last Thursday.

Jangho offered $3.25 a share. That was a significant premium to the $2.23 Healius shares traded at before the offer lobbed. The stock closed at $2.75 on Friday and is expected to drop on Monday after it begins to trade.

Jangho already has a 15.9 per cent stake in Primary and has been stalking the company for the past 2 1/2 years. The company has its origins in commercial construction in China, it has an expanding healthcare footprint, including in Australia.

It took over the previously ASX-listed opthalmic chain Vision Eye Institute (which also counted Primary as a shareholder) in 2015. Jangho was also revealed as a shareholder in under-pressure assisted reproduction clinic network Monash IVF in December.