NHS landlord Assura has backed an improved takeover offer from a healthcare investor amid the continued bidding war for the London-listed firm.
Assura said on Monday that its board has agreed a £1.79 billion offer from Primary Health Properties (PHP).
PHP had laid down a £1.68 billion bid last month but was outbid by a rival suitor, with a consortium led by US private equity firm KKR valuing the business at £1.7 billion.
Assura’s directors said they believe the fresh deal is in the “best interests” of the medical property firm’s shareholders.
Both bidders have upped their offers several times in recent months to try and clinch a deal.
Assura owns more than 600 buildings, including doctors’ surgeries, with a portfolio valued at around £3.1 billion. It has about 80 members of staff.
PHP, which is also listed on the London Stock Exchange, said it had agreed a deal worth around 55 pence per share.
Ed Smith, non-executive chair of Assura, said: “Following recent engagement between PHP and Assura, PHP has today further increased the terms of its offer, and has also addressed some of the potential risks that Assura had previously raised.
“The Assura board has always been and will remain resolutely focused on carrying out its fiduciary duties in the interest of Assura shareholders and in this context has decided to recommend this increased offer from PHP.”
Harry Hyman, non-executive chair of PHP, said: “The PHP board continues to believe in the strong strategic rationale of the combination, which will create a leading healthcare focussed listed REIT (Real Estate Investment Trust) with the scale and expertise to deliver significant benefits for the shareholders in PHP and Assura.
“The Increased PHP offer, which is expected to deliver earnings accretion to both sets of shareholders, allows Assura shareholders to participate in significant upside compared to crystalising value in cash at an inflexion point in the current economic cycle, and benefit from the combined group’s likely long-term rating, continuing capital growth and a growing dividend.”
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