phg prime target for m&a plays says ubs

Allied Medical, Healthe, Pulse Health prime targets for M&A plays, says UBS

THE healthcare and aged-care sectors are set for a flurry of activity in mergers and acquisitions as players look to increase synergies through local deals, UBS says.
In a ?shopping list? sent to clients this week, UBS said domestic acquisitions remain attractive from the perspective of synergy and low local risk despite ?diminished? opportunities caused by past consolidation.

UBS?s list was sent to clients as Healthscope remained suspended today after going into a trading halt yesterday as it cited the announcement of a ?potential acquisition?.

Healthcare analysts Andrew Goodsall and Dan Hurren believe this could be just the start, with up to 20 hospital facilities potentially ?available?.

Top of their list in the market is the unlisted Melbourne-based Allied Medical Group, which operates 17 medical centres across Melbourne and Brisbane.

?This has been a fast growing business with a pipeline of five further centres and 100 more GPs. We flag this business as one of the few ?clean? GP businesses potentially available for acquisition,? said Mr Goodsall.

Also on UBS?s shopping list was privately held hospital operator Healthe, the ASX-listed Pulse Health and the Independent Private Hospitals of Australia.

Mr Goodsall said aged care appears to be making a ?comeback? due to positive demographic trends and an abundance of opportunities, with targets more likely to be private companies.

In pathology, he said that recent regulatory change and future budget cuts may be a factor on sell-timing.

Meantime in M&A world, the emerging market?s percentage of global M&A to date is above that of Europe and the US for the first time, according to figures released today by Thomson Reuters.

Since December 31, 2009, M&A activity in the US has crawled to its lowest level since early 1993, with European M&A activity also at its lowest since early 1994, the figures showed.

http://www.theaustralian.com.au/business/city-beat/allied-medical-healthe-pulse-health-prime-targets-for-ma-plays-says-ubs/story-fn4xq4cj-1225829257458