It's getting to be time when the boards of Symbion Health, Healthscope and Primary Healthcare should abandon their prima donna status and start talking about some rational decision making and outcomes in the 12 month-long soap opera.
If the BHP Billiton move on Rio is becoming so tiresome that Rio is trying to get BHP to 'put up or shut up', then the situation in the battle for control of Symbion is well past the joke stage.
Symbion's board repeated its previous statement yesterday to shareholders that they reject Primary's $4.10 a share offer for the company.
Symbion noted that Primary failed to get enough acceptances for its offer, which closed on Monday, to declare it unconditional.
Primary built its stake, including acceptance instructions under an institutional acceptance facility, to 32.86% from the previous 20%.
As the overwhelming majority of that 12.86% is from institutions who accepted into the IAF and can withdraw just as easily, it's really not a significant move at all. Primary's base holding was 20.26% yesterday, up from 20.19% on Tuesday.
As its cash, it will not be supported by small shareholders who these days like shares for tax reasons, or a mixture of cash and shares. Primary doesn't want to offer shares because that would cut the holding CEO Ed Bateman and his family have.
"This is well short of the minimum 50.1 per cent Primary was seeking and clearly indicates that shareholders agree with their board's assessment that the offer price of $4.10 does not adequately compensate them for giving up control of Symbion Health," chairman Paul McClintock said in a statement accompanying the target statement to the Primary offer.
"The Symbion Health board will continue to act in all shareholders interests and will only recommend that shareholders sell their shares if we believe that shareholders are getting appropriate value for their shares."
"Symbion Health notes that 12.67% of the 12.86% of acceptances that Primary received relate to acceptance instructions under the Institutional Acceptance Facility. These acceptances will not be delivered to Primary by the Facility Agent until Primary has declared its offer free from all defeating conditions. Shareholders who have lodged acceptance instructions into the Institutional Acceptance Facility have the ability to withdraw these instructions.
"As Primary has not stated that it will otherwise waive the conditions to its offer, it remains subject to 13 outstanding conditions. If these conditions to Primary's offer are not satisfied or waived before the offer period ends, Primary's offer will lapse," Mr McClintock said.
Primary's offer values Symbion at $2.65 billion.
Primary's rival is private hospitals operator Healthscope which has made two attempts to takeover Symbion and its pathology, diagnostic imaging and medical centres.
The first attempt was thwarted by Primary which voted its 20% against a scheme of arrangement merger and the second by an adverse ruling from the Australian Taxation Office which terminated the second attempt, which involved the structure of the first bid being reversed.
Healthscope has built a stake of 11.91% through what seems to be a form of option agreement with investment bank and brokers, Goldman Sachs JBWere. That doesn't involve paying for the shares, just a fee and undertaking to make good any losses for Goldman's.
That in turn complicating the matter because the exact nature of the holding isn't fully clear, especially the underlying voting rights and whether they can be used by Healthscope at any time
Then there's the question of the patience of the two private equity groups, Ironbridge Capital and Archer Capital which were to have bought the wholesale and consumer businesses on Symbion in the two bids from Healthscope.
If they get bored or the turmoil in credit markets convinces them to hunker down and abandon the deal, then there would be very few buyers for the assets.
Healthscope would have trouble buying them, as would Primary simply because of the absence of anyone of scale who could be interested in purchasing them, without running into trade practices concerns; or financing a deal in the current rough credit markets.
No one wins a war of attrition like this: the managements of all three companies have been diverted for months and health care isn't the easiest of businesses to run at the moment with changes of government, cost shifting brawls and rising costs.
PRY shares rose 3c to $12.10; SYB shares fell 1c to $4.04, HSP finished down 5c at $5.41.
