Now this takeover situation is either going to pan out or it will be a very messy, very sticky corporate play that causes casualties.
Sigma is desperate to crash the Healthscope-Symbion dance party and is trying hard to be noticed.
So it is time for it to do a deal, launch a bid and have it assessed by Symbion, shareholders, the market and the ACCC, or walk away.
Healthscope and Symbion are doing the merger quick step. Healthscope started it and managed to find the key to Symbion's dance card and filled out the right words and numbers at the end of last month and the duo are now locked in step.
But industry major, Sigma Pharmaceuticals, wants to cut in and it's been looking for friends to help pay for its attempt.
Sigma has been trying to find an industry dace partner for almost a year: it made two passes at the struggling Australian Pharmaceutical Industries and both times got the knock back.
Primary Healthcare made a pass at Symbion and that attempt foundered on over optimistic ambitions in the Primary boardroom.
But that exposed Symbion and it was only a matter of time before either SIP or HSP put its best foot forward and tried to embrace SYB.
Healthscope won that race with its $2.9 billion cash and scrip offer with two private equity buyers (Archer Capital and Ironbridge for the warehousing and logistics businesses).
But within days Sigma CEO, Elmo deAlwis, hinted that he and his company were casting around for 'helpers' to launch a bid: Sigma would buy the SYB consumer businesses (Chemists and vitamins) and the friends would buy the distribution and logistics operations (similar in concept to the HSP offer).
Things went quiet and then in yesterday's morning papers there were a series of well-leaked stories about Sigma being on the verge of launching a bid with partners
That produced this statement to the ASX from SIP:
"Sigma Pharmaceuticals Limited ("Sigma") announced today that, as part of its ongoing objective of pursuing suitable acquisition opportunities, it is in discussions with a private equity consortium with a view to identifying whether a joint offer can be formulated for the Consumer and Pharmacy businesses of Symbion Health Limited ("Symbion"), with Sigma buying the Consumer Products part and the consortium buying the pharmaceutical wholesaling part of the business.
"If the parties are able to formulate a joint offer, it is intended that the joint offer will be made to Symbion on or by 18 June 2007.
"Symbion has stated in its Scheme Implementation Deed with Healthscope Limited that the offer price under any offer for its Consumer and Pharmacy business must be at least AUS $1.075 billion."
………………
Then Symbion issued its statement, and the situation got a touch confusing:
"On 1 May 2007 Symbion Health announced that it had received an unsolicited, incomplete and non-binding proposal from a consortium comprising Healthscope Limited, Ironbridge Capital and Archer Capital for the acquisition by Healthscope of all Symbion Health shares on issue and the divestiture of Symbion Health's pharmacy services and consumer businesses to Ironbridge Capital and Archer Capital (the "Proposed Transaction").
"Subsequently on 29 May 2007 Symbion Health Limited announced that it had reached an agreement with Healthscope to implement the Proposed Transaction. At that time Symbion Health released to the ASX a copy of the Scheme Implementation Deed entered into with Healthscope.
"Symbion Health has noted comments in the media in relation to the Proposed Transaction including in today's press reference to a counter-offer for the pharmacy services and consumer businesses by Sigma Pharmaceuticals Limited and Carnegie Wylie / Sun Super.
"Symbion Health advises that yesterday it received an unsolicited letter from Sigma Pharmaceuticals Limited relating to the proposed acquisition of the pharmacy services and consumer businesses by Sigma Pharmaceuticals Limited and a newly incorporated company sponsored by Carnegie Wylie & Company Pty Limited, which was stated amongst other things, to be confidential, incomplete and non-binding.
"Symbion Health advises that it has informed Sigma Pharmaceuticals Limited that its letter does not contain sufficient information, for example but not limited to the availability of funding and details of conditions, for the Symbion Health Board to make a determination whether:
1. • there is a competing proposal which is a superior proposal; or
2. • there are any steps which the Symbion Health Board might take in accordance with the Scheme Implementation Deed which may reasonably be expected to lead to a competing proposal, which the Symbion Health Board might be able to determine on or before 18 June 2007 is a superior proposal.
"The letter from Sigma Pharmaceuticals also indicated that if it forms a view that any aspect of the matters canvassed in the letter is disclosed to any third party it will be withdrawn immediately and will not be repeated. Symbion Health has asked Sigma Pharmaceuticals Limited whether in the light of comments in the media a trigger event for withdrawal has occurred."
All good points. It is a contested, or rather, could be a contested takeover situation, so lots of things are said that might not be normally uttered by the various players.
But Symbion's statement provided more detail that SIP did in its statement and the attempt to limit SYB's ability to disclose the offer to third parties is a bit rich.
SIP and its CEO seem determined to be a consolidator in the pharmaceutical retailing and distribution areas and in some products, even though Sigma is the industry leader and would face ACCC scrutiny.
Sigma is looking desperate to dance,
