Peter and Anya Hutson and James Reeves latest attempt to wrest control of Abano Healthcare has failed, with the partial takeover falling well short of the 50.01 per cent level needed.
Auckland-based Abano today said the hostile partial takeover mounted by Healthcare Partners, the Hutsons and Reeves vehicle, attracted just 2.35 per cent of the medical investor's shares, which would have taken its holding to 21.37 per cent, from the 19.02 per cent they currently hold.
Healthcare Partners last month lifted its offer to $10.16 a share from $10, although it would have deducted the company's 16 cents per share interim dividend from the payment had the bid been successful. They also said they would entertain mounting a full takeover provided they got access to the company's books to perform due diligence.
The company's board recommended shareholders reject the offer and wouldn't give the Hutsons and Reeves access to its books to do due diligence, and used their dividend to offset the cost of the takeover. The company today said there is still more than $377,000 outstanding and overdue, with final costs still to be charged, and it will seek to recover the remaining amount.
"Abano's board and management are pleased that the distraction of this hostile bid has now ended and they remain focused on continuing to grow the company and delivering value to all shareholders," it said in a statement.
Healthcare Partners launched the offer saying they wanted to improve the company's performance by halting acquisitions in the medium term in order to reduce debt, while improving the dental practices' operations. They would also install three new directors. The Hutsons and Reeves only wanted to lift that to 50.01 per cent, meaning any acceptances above that level would have been scaled.
Peter Hutson and Reeves have been lobbying for change at Abano for several years, supporting an informal takeover bid in 2013 by Archer Capital at $6.97 a share, which would have seen the Australian private equity firm take the healthcare investor's dental businesses and hand the audiology units to Hutson for a nominal sum.
The offer was turned down by the Abano board as being too low. Archer was refused due diligence access because it could become a direct competitor to Abano, and Peter Hutson left the board. That bid also attracted attention from the Financial Markets Authority over the way the market was told of the plans, although a civil suit was dropped and each side bore their own costs when the regulator deemed it wasn't in the public interest to pursue a case.
Peter Hutson and Reeves later tried to oust Abano chairman Trevor Janes, calling a special meeting of shareholders, though the resolution was voted down, and they unsuccessfully opposed Janes' re-election at the company's latest annual meeting.
Abano shares last traded at $8.90 and have gained 24 per cent the past 12 months.
The company's valuation range by independent adviser Grant Samuel was criticised by Healthcare Partners as using unrealistic assumptions and was later revised to reflect shares issued as part of management's long-term incentive scheme, putting a fair value of between $9.92 and $11.93, from $9.95 to $11.96.