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Assura rejects ‘opportunistic’ MedicX approach

Primary care property investor and developer Assura has rejected an “opportunistic” takeover proposal by its peer MedicX Fund.

GP landlord Assura said today that its board has decided unanimously to reject the potential bid by Medicx, first mooted on 17 May.

The all-share offer proposal was for the entire issued share capital of Assura on the basis of 1 MedicX Share for every 2.05 Assura shares. The offer valued Assura at 40p per share, 10 per cent above its share price.

Shares in Assura then rose 7 per cent to 38.7p, valuing the group at about £200m, while MedicX shares remained at 82.75p, valuing it at £216m.

MedicX said it believed the tie-up would enhance dividends and create “one of the major players in the medical property industry providing primary care services to approximately 5 per cent of the UK population”.

But the Assura board said it had reviewed the MedicX proposal with its advisers and concluded that “while it is supportive of industry consolidation, this opportunistic all-share proposal fails to recognise the existing and potential value of Assura and is not in the interests of all shareholders”.

Assura said MedicX was trying to take advantage of its higher net asset value, but said this was “a disparity which the board believes is not justified given the outlook for Assura”.

It added: “Moreover, the board is sceptical as to whether MedicX’s market rating can be maintained given its policy of paying uncovered dividends, in part funded by regular share issues, and the continued growth rate which such a rating implies, in particular from an enlarged business.”

Meanwhile, MedicX announced this morning it has spent £45m acquiring 14 assets from developer GPI, including a portfolio of seven operational, fully let primary care medical centres and seven further properties under construction.

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