Ann: 1QFY23 Business Update, page-6

@ace7979,

Responding to your question on the JAN thread, namely "Sorry for going off topic, but would you say RHC is in a similar situation since the deal fell through?", I don't believe RHC is still an obvious takeover target in its current form.

As the events of 2022 have shown, its a complex web to untangle for any would-be acquirer who is only after the best bits (those best bits being RHC Australia, RHC UK and the very significant property portfolio... besides operating hospitals, RHC is effectively also a massive land baron)

However, I do think that the approach from KKR-led consortium has placed pressure on the board to disgorge the laggard in the portfolio, namely the French business.

Générale de Santé’s (GdS) financial accounts are 100% consolidated with Ramsay Australia/UK, and because GdS's returns are inferior (low single-digit Return on Assets), c.f. RHC Australia in the high teens), so consolidating GdS reduces RHC group returns.

GdS is also more heavily geared than RHC Group (GdS is carrying A$2.5bn of debt, compared to RHC Australia/UK of A$2.3bn.), causing RHC's financial gearing to appear higher than it really is.

So divesting GdS, or a restructure of ownership would simpilfy RHC's accounts, lift its financial returns, and lower gearing.

If GdS was to be sold, then I'd say RHC was back in play.

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