Bain wins over Estia in $838m victory for private equity
Private equity group Bain Capital has won its five-month pursuit of aged care home operator Estia Health, with its latest $838 million offer being endorsed by the Estia board.
Estia entered into a scheme implementation agreement with Bain Capital, with Bain agreeing to acquire Estia for $3.20 per share, it told the ASX on Monday.
The Estia board unanimously recommended that shareholders vote in favour of the scheme in the absence of a superior proposal. A shareholder vote is earmarked to happen in November.
Estia chairman Garry Weiss accepted Bain’s latest bid. Jessica Hromas
Bain first made a buyout proposal on March 23 at $3 per share, and returned on June 7 with a $3.20 offer, enough for the Estia board to grant Bain due diligence to examine the inner workings of the company.
Estia Health chairman Gary Weisse said on Monday that even though the Estia board had confidence in the company’s outlook, there was a recognition that the cash price offered was at an “attractive” premium.
“We are pleased that Bain Capital has recognised Estia Health’s value as a leading Australian aged care operator with a strong reputation for person-centred care,” Dr Weiss said.
“The Estia Health board is confident as to the outlook for the business, however, recognises that the scheme allows shareholders to realise certain cash value now at an attractive premium.”
Estia is one of Australia’s largest aged care operators, having more than 6500 places in 70 sites across the country.
Estia closed at $2.14 on March 21, before Bain’s original proposal. The offer which has been accepted by the Estia board values the equity at $838 million, and gives an enterprise value of $959 million.
Under the deal, Estia is permitted to pay fully franked
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