New Zealand’s Vital Healthcare Property Trust has said that it will not participate in the A$4.18bn (US$2.97bn) acquisition of Healthscope, Australia’s second largest private healthcare operator.
In a statement, it said: “After due consideration, Vital has declined to participate in the Healthscope real estate opportunity with NorthWest Healthscope Properties REIT.”
At the beginning of February, Canadian investment firm Brookfield made an offer of A$2.50 share for the group. It also launched an off-market takeover offer at A$2.40 per share. The rest of the acquisition was to have been funded by the sale-and-leaseback of just over half of Healthscope’s portfolio – 22 of its 42 private hospitals – to real estate investment property trusts Medical Properties Trust and Northwest Healthcare Properties for about A$2.5 billion.
“Consideration of this rare opportunity has been a very thorough and detailed process for the board and Vital. Unfortunately, despite the board’s collective view earlier in calendar 2018 that the Healthscope real estate opportunity was in line with Vital’s strategy, we were unable to see that the opportunity met all the overall investment objectives for the trust,” said independent directors Andrew Evans and Graham Stuart.
“Further, management and directors have also listened carefully to a range of investor feedback over the last few weeks and it has factored heavily into our conclusion. Turning away from a quality and scale portfolio opportunity can be a difficult decision but, for Vital in this instance, we are satisfied it is the right decision at this time in light of the broadest range of applicable considerations,” they added.
At the same time, chief executive David Carr resigned. His last day is 15 June.
Miles Wentworth, who managed the trust until 2006, has been appointed as interim manager with immediate effect and will be responsible for the trust’s day to day operations.