GOTHENBURG, Sweden,
Aug. 21, 2018 /PRNewswire/ --
Capio and Vivalto Santé ("Vivalto") today announce that they
have entered into exclusivity regarding the proposed sale of Capio
France to Vivalto pending the finalization of the documentation
related thereto as is customary in the French market. The
consideration for the proposed transaction would be an upfront
enterprise value of MEUR 425 plus an earn-out contingent on 2018
financial performance, up to a total enterprise value of MEUR 455.
The proposed purchase by Vivalto is binding on Vivalto and fully
financed. The proposed transaction would accelerate the positioning
towards the less capital intensive Nordic operations and build on
Capio's leadership positions to further drive growth and
shareholder value. The completion of the transaction would be
subject to certain conditions, as further described below,
including the approval of Capio's shareholders at an EGM, as
required under Swedish takeover regulation, to be convened in due
course.
"Under the proposed transaction, we would secure an attractive
price for our French operations, allowing Capio to accelerate its
focus on the less capital intensive Nordic operations and build on
its current leadership positions to drive further growth in a
highly fragmented market, aided by specialization and
digitalization. The proposed combination of Capio France and
Vivalto, also forms a strong healthcare provider positioned as the
third largest private operator in France. Capio France, with its leading
position in Modern Medicine and Rapid Recovery, will contribute to
spread and accelerate its medical know-how for the benefit of the
new company," said Thomas Berglund,
President and CEO of Capio.
"Capio France and Vivalto share a common understanding of the
rapid changes facing the French private hospitals industry and the
absolute need to focus on modern medicine, digitalization and
innovation. Both groups have a similar philosophy of excellence and
of Star hospitals, placing the quality of care and the patient
pathway, before and after hospitalization, in center of their
strategy. The proposed transaction should strengthen both Capio
France and Vivalto to the benefit of all stakeholders and also pave
the way for future collaboration between Capio Group and Vivalto
within research, digitalization and new services," said
Daniel Caille Chairman and CEO of
Vivalto.
Transaction details
The consideration for the proposed transaction would be an
upfront enterprise value of MEUR 425 plus the earn-out contingent
on 2018 financial performance in line with management expectations
outlined in the January – June 2018
interim report, up to a total enterprise value of MEUR 455. This
would imply an EBITDA multiple range of 9.0-9.6x and an EBITA
multiple range of 19.0-20.3x based on Capio France's LTM financials
as of June 30, 2018. The proposed
purchase by Vivalto is binding on Vivalto and fully financed.
Net proceeds are expected to be between MEUR 400 to 430 after
deducting external net debt transferred and other items including
customary working capital adjustments estimated at in total MEUR
25. In addition, the deconsolidation of Capio France from Capio
Group would also remove the retirement liabilities related to the
French business, estimated at MEUR 33, from Capio Group's balance
sheet (1). It is anticipated that proceeds from a sale would be
used partly to pay down Capio Group debt and partly as a return of
cash to shareholders. Capio will provide an update through which
mechanisms this will be effected in due course.
Capio France employees' representatives will be consulted as per
applicable French law. Vivalto has completed all material
commercial/financial due diligence and the enterprise value and
related adjustments are agreed upon. Finalization of the
transaction would be subject to:
- Completion of a confirmatory due diligence (including legal,
tax and HR) of Capio France by Vivalto, the outcome of which
may give Vivalto the right to terminate the proposed purchase,
only if Vivalto were to identify risks (covered by
the representations and warranties in the Sale and Purchase
Agreement), for an aggregate amount of MEUR 25 or more
- The approval of relevant regulatory authorities, and
- The approval of the Capio shareholders at an EGM as required
under Swedish takeover regulation as a consequence of Capio being
subject to a public cash offer, to be convened in due course.
Provided that the conditions are satisfied, the transaction
would be expected to close by end of December 2018. Capio has undertaken to cover
Vivalto's costs in relation to the proposed transaction by paying
Vivalto's actual costs and expenses up to MEUR 5.0 if the Capio
board (i) terminates the proposed sale prior to having convened an
EGM for approval of the proposed sale; (ii) does not convene or
cancels the EGM, (iii) withdraws its proposal or its unanimous
support for approval of the proposed sale by the EGM; including
recommending the Capio shareholders to accept a public takeover
offer for the shares in Capio. This cost-coverage arrangement has
been approved by the Swedish Securities Council in AMN 2018:31. If
Vivalto would not receive the approval of relevant regulatory
authorities, Vivalto is obliged to cover Capio's actual costs and
expenses up to MEUR 5.0. Further information will be provided to
the Capio shareholders in good time prior to the EGM, including the
Board's view of the Nordic market potential going forward. The EGM
is expected to be held no later than two weeks before the expiry of
the acceptance period under the public cash offer.
Focusing on the Nordics
Proceeds from the transaction will strengthen Capio's capital
structure and significantly enhance management's ability to deliver
Capio's strategic focus and drive shareholder value across its less
capital intensive Nordic operations.
Capio has today an established base in Modern Medicine and the
Nordic market provides clear opportunities for continued strong
organic growth. Capio's specialized businesses and nationwide
presence in Sweden, Norway and Denmark allow the company to rapidly expand
tailor-made patient offerings and coherent care chains across the
Nordic countries. Capio is at the forefront in driving
digitalization in healthcare with its combined digital and physical
platform (900,000 listed patients and more than 100 primary care
centers), launched in Sweden and
Norway to follow. The digital
market in Sweden is currently
growing at a rate of +100% p.a. and Capio is well positioned to
capture growth in this rapidly growing market. In addition there
are substantial growth opportunities through further consolidation
of a fragmented market with a strengthened balance sheet.
As announced in the interim report January-June 2018, during the second half of 2018 Capio
is preparing for a closer coordination of the businesses in
Sweden, Norway and Denmark to accelerate growth and streamline
offerings both from a medical and operational efficiency
perspective. The step-wise implementation of this Nordic
cooperation, based on specialization, will start in Q1 2019.
About Capio France
Capio has a strong national presence in seven healthcare
regions, including the rapidly growing areas around Paris, Lyon
and Toulouse. The segment's 22
hospitals and specialist clinics provide a wide range of
treatments, primarily within medicine, surgery and obstetrics. For
the rolling twelve month period ending June
30, 2018, Capio France's about 5,400 employees (average FTE)
provided healthcare services across 645,000 outpatient visits and
130,000 inpatient visits respectively, generating net sales of MSEK
5,602 representing 35% of total group. The EBITDA of the same
period was MSEK 479, representing 43% of total group and the EBITA
was MSEK 227, representing 36% of total group. The capital employed
of Capio France was MSEK 4,758 as at June
30, 2018.
Other
Capio continues to assess alternatives for its German operations
and intend to intensify the process for the divestment of this
operation from the beginning of September. Capio will return with
more information once available.
PJT Partners is acting as exclusive financial adviser,
Mannheimer Swartling and Allen & Overy are acting as legal
advisers and Fogel & Partners as communication adviser to Capio
on this transaction.
The Board of Directors of Capio AB (publ)
Media and investor call invitation
Media representatives, investors and analysts are invited to
participate in telephone conferences as below. CEO Thomas Berglund and CFO Olof Bengtsson will comment on the proposed
transaction and answer questions. Prior to the start of the
telephone conference, presentation slides will be available at
www.capio.com.
Media conference call
Tuesday August 21, 2018 at 09.15
(CET)
To participate in the telephone conference, please register and
dial in five minutes prior to the start of the conference call.
Sweden: +46-8-566 426 94
France: +33-170-75-07-12
UK: +44-20-3008-9802
US: +1-855-831-5945
Investor and analyst conference call
Tuesday August 21, 2018 at 10.30
(CET)
To participate in the telephone conference, please register and
dial in five minutes prior to the start of the conference call.
Sweden: +46-8-566-426-64
France: +33-170-75-07-25
UK: +44-20-3008-9813
US: +1-855-753-2237
Contact:
Thomas Berglund
President and CEO
Telephone: +46-733-88-86-00
E-mail: thomas.berglund@capio.com
Olof Bengtsson
CFO
Telephone: +46-761-18-74-69
E-mail: olof.bengtsson@capio.com
Henrik Brehmer
SVP Group Communication & Public Affairs
Telephone: +46-761-11-34-14
E-mail: henrik.brehmer@capio.com
This is information that Capio AB (publ) is obliged to make
public pursuant to the EU Market Abuse Regulation. The information
was submitted for publication, through the agency of the contact
person set out above, at 08.45 a.m.
(CET) on August 21,
2018.
(1) Estimated adjustments assuming illustrative closing at the
end of 2018
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