Brookfield requires 75 per cent of votes cast at the meeting to support the offer which would deliver Healthscope investors $2.465 a share cash.
AustralianSuper’s investment committee, consisting of its investment managers and some of its board members, is expected to make a decision on the offer ahead of the scheme meeting scheduled for May 22.
AustralianSuper was part of a failed rival bid for the private hospital operator which was lead by private equity group BGH Capital.
AustralianSuper was obliged to support the inferior indicative offer from the BGH consortium until the agreement ended last month.
The independent expert’s report from advisory firm Grant Samuel said the $2.465 cash offer from Brookfield is fair and reasonable.
“Therefore the scheme is in the best interests of Healthscope shareholders and the takeover offer is fair and reasonable, in the absence of a superior proposal,” said the report.
Grant Samuel noted that, while another bid is possible “there are practical constraints against progressing any alternative proposal”.
The scheme is in the best interests of Healthscope shareholders and the takeover offer is fair and reasonable.
Advisory firm Grant Samuel in its independent expert’s report on Brookfield’s offer for Healthscope
And given the amount of time that Healthscope has been in play as a takeover target, “the prospects of a superior offer in the short term appear unlikely,” the firm said.
It also noted that the Healthscope share price could fall, “perhaps significantly,” if investors rejected the scheme and the takeover offer which has been offered by Brookfield as an alternative proposal if the scheme failed.
Healthscope also cut its fiscal 2019 hospital operating earnings guidance in the document, saying this was prompted by weaker private hospital market conditions, as well as the prioritisation of public over private patient care in the ramp up of its Northern Beaches Hospital in New South Wales.
The company said it was now targeting hospital operating core earnings in a range of $362 to $376 million, or a growth of 5 to 9 percent, from its initial target of at least 10 percent growth on 2018.
Healthscope had reported hospital operating core earnings of $344.7 million in 2018.
The company’s shares closed unchanged at $2.46, just short of Brookfield’s offer price of $2.465.
Colin Kruger is a business reporter. He joined the Sydney Morning Herald in 1999 as its technology editor. Other roles have included the Herald’s deputy business editor and online business editor.