Healthscope property auction underway

from afr today....

Sep 19 2018 at 12:15 AM
Updated Sep 19 2018 at 12:15 AM
Healthscope property auction underway; UBS sends flyer

by Sarah Thompson Anthony Macdonald
The pitch is finally underway for Healthscope's property portfolio.
After months of structuring and preparations, a marketing flyer is drifting into inboxes of local property players ahead of an auction. Healthscope has investment bank UBS on board to run a process.
Interested parties said the flyer had pitched the hospital owner's property portfolio as "one of the largest healthcare portfolios in Australia", and rattled off data consistent with what Healthscope was telling its own shareholders at its results day last month.
Sources said the the new unlisted property trust was likely to receive $80 million to $90 million in rental payments in its first year, while operating businesses located inside the property portfolio generated about 65 per cent of Healthscope's FY18 hospital EBITDA of $345 million.

It comes as Healthscope looks for a co-investor to take up to a 49 per cent stake in the new unlisted property trust, while the hospital operator would retain the controlling share.
Analysts reckon the property stake could be worth $800 million to $850 million.
Tyrekickers said it looks like the sort of pitch aimed at netting an offshore buyer - or at least drawing them into the auction.
There was lots of talk about total healthcare expenditure in Australia - which was up 4.6 per cent a year over the past decade - and public hospital wait times which were up 14 per cent over the same timeframe.
Healthscope and its bankers were also said to have pointed out that Australia's population was growing - 1.7 per cent a year on average over the past decade - and getting older, with 15 per cent of the population now aged over 65.
There was also some key stats about Healthscope - 43 hospitals, more than 5100 inpatient beds and targeting at least 10 per cent hospitals operating EBITDA growth in the 2019 financial year - and the historical performance of its hospitals.
The flyer is expected to mark the start of a two-stage auction.
Healthscope has told shareholders it wants to have the new unlisted trust set up - and a new investor locked in - by the end of the 2019 financial year.
A big part of the pitch is expected to be the relatively unusual asset class. Most big Australian property investors' portfolios are split between industrial, office and retail, with few owning things like hospitals.