Which should get the deal done, I think
(Unless, of course, an interloper gets involved [*]).
For context, Healthscope (HSO) was taken over by Brookfield for a mere 23% premium, and that was even after Brookfield was not the sole bidder (although, to be realistic, the BGH Capital-AustralianSuper consortium that made the first bid for HSO was really a lightweight contender).
[*] And the scope for a bidding contest happening is far from zero: a company like RHC is a private equity operator's dream; it has stable and predictable earnings and cash flows (and hence, can be geared aggressively...far more aggressively that public markets will tolerate), and is rich in highly sale-able assets which can liberate capital to enhance the returns of the PE operators.
Case in point, the carrying value of RHC's property portfolio is $3bn... and that is valued at cost less accumulated depreciation and accumulated impairments, so who knows what it must be worth if it was today marked-to-market, which is what would effectively happen if those property assets were transferred into a property trust after being acquired by a PE group?
$4.0bn?
$5.0bn?
What about $6.0bn, maybe?
RHC Price at posting:
$64.39 Sentiment: None Disclosure: Held
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