Leighton Holdings is receiving plenty of interest for the sale of its John Holland business and while an offshore suitor appears the most likely acquirer, one major local firm may yet have a say in the matter.
Elsewhere, progress continues apace for the biggest IPO of the year, a curveball is thrown the way of Goodman Fielder’s board and Woolworths SA leaves Solomon Lew with a major decision to make.
The race for Leighton Holdings’ John Holland operation is kicking into gear, with rival Lend Lease believed to be among the interested parties. According to The Australian Financial Review, Lend Lease may make an offer for the $1 billion-plus business ahead of the July 31 deadline and appears the only local hope capable of outbidding America’s KBR, France’s Bouygues and South Korea’s Samsung C&T.
In the IPO market, the prospectus has been lodged for the float of Healthscope, likely the largest local listing of the year. The private hospital operator is seeking to raise $2.25bn to $2.57bn, with a market capitalisation of close to $4bn and an enterprise value of up to $5bn. The firm may still explore a sale of its property assets upon listing, with the AFR reporting that a divestment is likely within 12 months as Ventas REIT and Vital Healthcare Property Trust continue to circle.
Healthscope, currently owned by TPG and The Carlyle Group, has already secured cornerstone investors to acquire $1.7bn worth of stock ahead of its planned July 28 listing. Before then we will receive a further guide on the strength of the IPO market through the floats of Smartgroup and 3P Learning, which will hit ASX boards on July 2 and July 9, respectively.
Like several takeovers this year, the acquisition of Goodman Fielder is not quite progressing as smoothly as possible. In May, suitors Wilmar and First Pacific received the backing of Goodman’s board for a $1.4bn takeover after raising their offer from 65c to 70c a share (plus a 1c dividend).
After conducting due diligence, however, the suitors are now believed to be pressing the board to back a lower offer, likely in the 66c-68c range. It puts the Goodman board in an awkward spot; either they support a lower deal or reject the new proposal and see their share price tank.
Elsewhere, Woolworths SA has confirmed its offers for both Country Road and David Jones are ‘final’, leaving the ball firmly in the court of Solomon Lew. The retail rich-lister must now decide if he wants to make a decent profit on his stakes in the two businesses or frustrate longtime adversary Woolworths by holding out.
Finally, WA-based Craig Mostyn has purchased the nation’s largest abalone farm, Great Southern Waters, for under $20m, while InterOil has offloaded its refinery and distribution businesses to Puma Energy for about $550m.