The Healthscope Ltd
(ASX: HSO) share price is up by 6% thanks to an update surrounding the potential takeover bid.
Healthscope is the second largest private hospital business in Australia, it employs over 18,000 staff. The business was formed in 1985 and re-listed onto the ASX in July 2014 after a period of private equity ownership.
Why Healthscope shares are up 6%
Healthscope provided an update to the market to say that potential takeover suitor Brookfield has done a substantial amount of its due diligence and at this stage has no reason why it won’t continue with the takeover through a scheme of arrangement for a value of $2.585 per share.
But, it isn’t yet a done deal. Brookfield still needs to complete its due diligence and arrange committed debt financing. To make sure this can happen, Healthscope and Brookfield have agreed to extend the exclusivity to 5pm on 18 January 2019.
Is it worth buying Healthscope shares?
Healthscope shares are currently trading at $2.19, so it does suggest a potential gain of 18%, or a 11% gain to the separate off-market takeover offer of $2.455 per share.
The takeover is not guaranteed so investors would be taking a risk with a limited upside at this stage. It might be a wiser move to go for shares not going through a takeover with a proven track record, such as the shares in the free report below.
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