New merger plan inferior: Healthscope

Tegan Fleming

The original proposal, put to shareholders on 11 September, narrowly missed out on gaining approval after Symbion's major shareholder, Primary Health Care, used its 20 per cent shareholding to vote against the scheme.

"Healthscope, Symbion Health and the Ironbridge & Archer Capital Consortium believe the revised proposal is a compelling proposition for their respective sets of shareholders and investors.

"However, each party also has the belief that the original proposal continues to provide an outcome for all parties that is superior to the revised proposal," Healthscope said in a statement.

Under the revised proposal, Symbion shareholders would receive about nine cents less per share due to what Healthscope described as "a modest amount of value leakage as a result of increased transaction costs and charges".

Healthscope chair, Kevin McCann, said "Symbion Health shareholders other than Primary made it absolutely clear that the scheme with Healthscope was attractive to them.

"Symbion Health and Healthscope have agreed on a revised proposal that delivers Symbion Health shareholders and Healthscope shareholders a similar outcome," Mr McCann said.

Healthscope's managing director, Mr Bruce Dixon, said that the merger was strategically compelling in May when it was first proposed and continues to make sense now.

"We've chosen this transaction structure over a number of alternatives because it preserves the commercial rationale for putting these businesses together in the first place.

"We can build a first rank national health services company, spearheaded by the nation’s leading pathology network," Mr Dixon said.

The revised proposal now awaits approval from both Healthscope and Symbion shareholders.