In a joint statement Mediclinic and Remgro said they have agreed the terms by which Remgro will acquire 119 923 335 Spire Healthcare shares from funds managed by Cinven, a European private equity firm, at a price of £3.60 per share for a total purchase consideration of £431.7m to secure the Spire Healthcare holding in the opportunity window available.
Mediclinic in turn will acquire the Spire Healthcare holding from Remgro for about R8.6bn, the aggregate of the purchase price and transaction and funding costs.
Spire Healthcare is one of the UK’s largest private hospital providers, led by a strong and highly experienced management team, with 39 hospitals and 13 clinics across England, Wales and Scotland. The company offers a range of integrated surgical, medical and diagnostic services.
Mediclinic CEO Danie Meintjes said the private healthcare group had identified the opportunity to acquire a meaningful holding in Spire Healthcare and could now realise it with the facilitation of Remgro.
"We are investing in a growing developed market while also diversifying into an attractive new geography with a strong currency. Both Mediclinic and Spire Healthcare will benefit from collaboration through the sharing of knowledge and experience and improving cost synergies and efficiencies.”
To raise the requisite funding Mediclinic proposes a fully underwritten, renounceable rights issue to qualifying Mediclinic shareholders of 111 111 111 shares at R90/share for an aggregate amount of R10bn.
The balance of about R1.4bn will be retained by Mediclinic for transaction costs and to support future growth opportunities.
The acquisition of the Spire Healthcare holding from Remgro is subject to the successful completion of the rights issue.
Remgro currently holds 41.3% of Mediclinic and has committed to follow all their rights and agreed to underwrite the balance of the proposed Mediclinic rights issue.
CEO Jannie Durand said Remgro "is delighted" to support Mediclinic in acquiring this holding in Spire Healthcare.
"By joining forces we were able to act swiftly in the interests of both Remgro and Mediclinic shareholders,” said Durand.
Mediclinic and Remgro have confirmed that they have no current intention of making an offer for the whole of Spire Healthcare.