Australian Unity Healthcare Property Trust (AUHPT) is doing everything it can to stop a voracious NorthWest Healthcare takeover after the Canadian-owned real estate giant offered $2.8 billion for the business.
AUHPT has rejected the fourth offer from NorthWest of $2.70 per Wholesale Unit, $2.76 per Retail Unit and $1.69 per Class A Unit to AUHPT members, which is a 38% premium to the price before NorthWest’s initial proposal in February and a 21% premium to the current price.
Australian Unity Funds Management (AUFM) has also secured a NSW Supreme Court order to adjourn the NorthWest Healthcare convened unitholder meeting scheduled in Melbourne for 1 July. It will now be held on Monday, 19 July at 10am and chaired by former ASIC Chair Alan Cameron AO.
“The Board believes that NorthWest’s proposal materially undervalues AUHPT, having regard to the current and expected future value of the portfolio and the benefits it could deliver to a potential acquirer. Other factors considered by the Board include the nature of AUHPT investors and their desire for long-term returns, the tax implications, and their ability to re-invest proceeds in comparable assets with a similar risk and return profile. AUHPT’s near-term development pipeline, valued at over $1bn, also offers the potential for future upside for unitholders,” said AUFM in a statement to unitholders.
In NorthWest Healthcare’s latest offer, it also said it was willing to spend $400 million to acquire units at $2.70 irrespective of whether its bid to buy AUHPT is successful. The offer eclipsed a move by AUFM, which is offering investors wishing to redeem investment a $2.60 payout, capped at $80 million.
Frustrated by AUHPT’s refusal to sell, NorthWest had called the unitholder meeting when it had offered $2.55.
To improve its defense, AUFM struck a deal with ASX-listed Dexus who made a $180 million cornerstone investment in a $320 million raising launched for its healthcare property fund.
NorthWest has subsequently filed a cross-claim in respect of AUFM’s proceeding relating to the eligibility of AUFM, Australian Unity and Dexus to vote at the proposed unitholder meeting.
NorthWest has also started legal proceedings in the Court seeking to invalidate the current AUHPT entitlement offer, the placements of wholesale units at a premium to Dexus and Australian Unity Strategic Holdings (AUSH), a wholly owned subsidiary of Australian Unity, and the premium cash offer being made by AUSH.
AUHPT owns hospitals, medical centres and aged care facilities throughout Australia, including Infinite Care’s Edmonton Aged Care Facility in Cairns, Queensland (pictured).