Healthcare organization Spire entertainings thoughts of possible asset sale
Spire Healthcare Considering Potential Sale Amidst Market Undervaluation
Spire Healthcare, a leading private healthcare provider in the UK, is exploring various options, including a potential sale, following a review by advisers from Rothschild & Co. This move comes amidst concerns that the company's current share price does not accurately reflect its value.
The FTSE 250 firm, which operates 38 hospitals and more than 50 clinics across England, Wales, and Scotland, has not yet received any takeover offers. However, the board of Spire Healthcare has appointed Rothschild to assess a range of options, including a potential sale of the company.
The decision to review strategic options was not unexpected, given the recent performance of Spire Healthcare's share price. Panmure Liberum analyst Seb Jantet stated that the news of a potential sale review was not surprising, given the share price performance. Major investors at Spire Healthcare have also urged the company to consider a sale to secure returns for shareholders.
One of the key drivers behind the potential sale is the company's unencumbered hospital portfolio, valued at over £1.4 billion. Harwood Capital Management, which owns around 5% of Spire, believes that the current share price does not reflect the true value of this asset. Harwood also notes Spire's occupational health business, with a goal of delivering £40 million in annual EBITDA over the medium term.
PureTech Health, another major investor holding 5% of Spire Healthcare shares, has also pushed for strategic options including a potential sale. They increased their stake in the company and recommended a sale to secure future reserves for shareholders.
Despite the bid speculation and potential sale review, Spire Healthcare's chairman, Sir Ian Cheshire, stated that the company believes it is undervalued by the market. He also mentioned that the board will continue to actively evaluate and implement actions that drive long-term shareholder value.
Following the news of a potential sale review, shares of Spire Healthcare increased by 13% in early trading. However, no further decisions have been made at this stage, and the process is preliminary. The company has held discussions with a number of parties about potential options, but no decision has been made regarding whether a sale will be pursued.
In conclusion, Spire Healthcare's potential sale review is a significant development for the private healthcare giant. The company's unencumbered hospital portfolio and occupational health business have attracted the attention of major investors, who believe the current share price does not accurately reflect the company's value. The board of Spire Healthcare, under the guidance of Rothschild & Co, will continue to evaluate strategic options, including a potential sale, in the coming months.
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