Primary Health Care and its chairman Ed Bateman are not happy campers.
Despite having a $4.10 a share offer on the table for Symbion Health, its target and its erstwhile partner, Healthscope, are not taking Primary and its CEO and chairman seriously, or so they think.
So yesterday PRY and Dr Ed called Symbion Health to postpone a meeting of shareholders scheduled for Thursday week November 30 to consider a sale of Symbion assets to Healthscope
Primary said "Symbion Health Limited had failed to address a number of Primary's concerns, despite the release by Symbion of both a Supplementary Explanatory Memorandum ("Supplement") and a correction to its notice of meeting last week.
"Primary further believes that, in light of its proposed cash takeover offer for Symbion of $4.10 per share, the Symbion board has no alternative but to now postpone the proposed shareholder meetings scheduled for 30 November 2007 until the ATO rulings, which Symbion itself have identified as critical, have been obtained.
"The confusing and befuddling nature of the Healthscope led revised proposal ("Healthscope Led Proposal") is highlighted by the fact that, together with Symbion's correction to its notice of meeting on 15 November 2007 which corrected an error in the original Explanatory Memorandum, Symbion has now released over 430 pages of disclosure materials to its shareholders in the past month.
"Primary notes that Symbion plans to release a further supplement this week.
"In Primary's view, the Supplement issued on 13 November 2007 did not adequately address a number of Primary's concerns in relation to the content of the original Explanatory Memorandum. Furthermore, it continues to highlight an unsupportable implied value range of $4.23 to $4.43 per share that is at the very top end of the value range adopted by the Independent Expert of $3.54 to $4.45.
"In light of Primary's proposed cash takeover offer for Symbion of $4.10 per share, Primary believes Symbion must immediately confirm:
* "That it will now postpone the proposed shareholder meetings scheduled for 30 November 2007 until ATO rulings have been obtained.
* "If the meetings are held without the ATO rulings, Primary's Offer has the potential to lapse. Primary does not believe it is in the best interests of any Symbion shareholders to be voting on the Healthscope Led Proposal without knowledge of whether it is capable of being implemented; and
* "Whether or not it will allow the Healthscope Led Proposal to proceed where the Healthscope volume weighted average share price ("VWAP") falls below $5.30."
Healthscope's share price has in recent times traded at the very bottom of the price range of $5.30 to $6.51 per share. Healthscope closed at $5.35 per share on Monday and rose 3c yesterday to $5.38 in the down market. Symbion shares eased 5c to $4.10 and Primary's shares were steady on $12.45.
Primary also said in its statement that Symbion should postpone the shareholder meetings scheduled for 30 November 2007 as the Supplement does not provide the detailed views of the Symbion directors regarding its Offer.
"In view of the timing of the 30 November 2007 meetings, Symbion shareholders need to receive the same level of assessment of Primary's Offer as they would in a target's statement.
"Symbion itself has stated in the Supplement that a target's statement will be sent to Symbion shareholders containing ‘all material information known to the directors of Symbion'. However, this is disingenuous because Symbion knows that shareholders need that information before they vote. Primary gave its bidder's statement to Symbion on 8 November 2007," PRY said in its statement to the ASX.
Symbion has rejected the $2.65 billion takeover offer from Primary as too low. PRY has 20% of SYB's shares and says it will vote against the second part of the latest Healthscope deal which will see the consumer and wholesaling and retail assets of Symbion sold to private equity groups, Ironbridge and Archer. PRY has the capacity to sink the offer as the sale will have to happen via a scheme of arrangement.
The Healthscope proposal depends upon obtaining a ruling from the ATO on scrip-for-scrip rollover relief and demerger relief.
