Japara Healthcare board recommends acquisition of its villages and aged care by Calvary for $380M

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The competition between Not For Profits Calvary and Bolton Clarke for the ASX-listed operator appears set to come to a close, with Japara today announcing that it has entered into a Scheme Implementation Deed (SID) with Calvary for $1.40 per share.

Japara has five retirement villages, led by Stuart Nicolson, plus 50 aged care homes with over 4,000 residents.

As we reported last month, Bolton Clarke pipped Calvary’s bid of $1.20 per share by two cents, offering a $1.22 per share and valuing the company at around $326 million.

But Calvary has evidently raised their own offer – and Japara’s Board of Directors has unanimously recommended the Scheme, “in the absence of a superior proposal and subject to an Independent Expert concluding that the Scheme is fair and reasonable and in the best interests of shareholders”.

The deal is still subject to Japara shareholders’ approval by the requisite majorities at the Scheme Meeting which is expected to be held in October 2021.

Should shareholders accept the offer, it will represent a significant shake-up of Australia’s aged care landscape – and the first time a large Not For Profit has successfully bid for a listed provider.

Calvary is one of Australia’s largest healthcare and aged care providers, responsible for over 12,000 staff and volunteers, 14 public and private hospitals, 17 retirement and aged care facilities and 22 community care centres.

Calvary National CEO, Martin Bowles (pictured right), welcomed the news, saying: “Over the next few months, Japara will seek broad shareholder and court approval.

“While we still have a way to go, this is very encouraging and another step to further establish our integrated care model across residential, community and hospital services.”

However, the deal would represent a significant loss for Japara’s founding investors, including co-founder Andrew Sudholz and its largest shareholder, MA Financial Group (formerly Moelis Australia).

Watch this space then.