Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On the 7 August, aged care provider <a href="https://www.smartkarma.com/entities/estia-health-ltd" target="_blank" data-smartkarma-citation="entities:77:1" rel="noopener">Estia Health (EHE AU)</a> and Bain Capital entered into a Scheme Implementation Agreement at <a href="https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02694600-3A622822?access_token=83ff96335c2d45a094df02a206a39ff4" target="_blank" rel="noopener">A$3.20/share</a> (less any dividends), a 50% premium to undisturbed</li>
<li>The Scheme Booklet is now out. A shareholder meeting will be held on the 15th of November with implementation expected on the 30th of November. </li>
<li>Estia paid a fully franked dividend of A$0.12/share on the 15th of September. Currently trading  tight to the adjusted terms of A$3.08/share. This still needs FIRB approval.</li>
</ul>


On the 7 August, aged care provider Estia Health (EHE AU) and Bain Capital entered into a Scheme Implementation Agreement at A$3.20/share (less any dividends), a 50% premium to undisturbed
The Scheme Booklet is now out. A shareholder meeting will be held on the 15th of November with implementation expected on the 30th of November. 
Estia paid a fully franked dividend of A$0.12/share on the 15th of September. Currently trading  tight to the adjusted terms of A$3.08/share. This still needs FIRB approval.


IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>The <a href="https://www.smartkarma.com/entities/estia-health-ltd" target="_blank" data-smartkarma-citation="entities:77:1" rel="noopener">Estia Health (EHE AU)</a> IE considers Bain’s A$3.20 (A$3.08 excluding paid dividends) offer fair and reasonable as it is above its valuation range of $2.83 to A$3.21 per share. </li>
<li>The offer is subject to FIRB and possibly aged care industry approvals. The MAC clause risk, particularly around material regulatory events, is diminishing.</li>
<li>This is a done deal. At the last close price and for the 30 November payment, the gross and annualised spread is 1.3% and 9.7%, respectively.</li>
</ul>


The Estia Health (EHE AU) IE considers Bain’s A$3.20 (A$3.08 excluding paid dividends) offer fair and reasonable as it is above its valuation range of $2.83 to A$3.21 per share. 
The offer is subject to FIRB and possibly aged care industry approvals. The MAC clause risk, particularly around material regulatory events, is diminishing.
This is a done deal. At the last close price and for the 30 November payment, the gross and annualised spread is 1.3% and 9.7%, respectively.


Estia Health (EHE AU): Scheme Meeting on 15 November

<ul>
<li>
<a href="https://www.smartkarma.com/entities/estia-health-ltd" target="_blank" data-smartkarma-citation="entities:77:1" rel="noopener">Estia Health (EHE AU)</a> has entered a SID with Bain Capital at A$3.20 per share, a 49.5% premium to the undisturbed price (21 March).</li>
<li>The offer is attractive in comparison to historical share prices and multiples. The offer is also attractive in comparison to the <a href="https://www.smartkarma.com/entities/japara-healthcare-ltd" target="_blank" data-smartkarma-citation="entities:14760:1" rel="noopener">Japara Healthcare (JHC AU)</a> precedent transaction. </li>
<li>The MAC clause, particularly around material regulatory events, could be risky. At the last close and for an end-of-December payment, the gross and annualised spread is 3.7% and 9.5%, respectively.</li>
</ul>



Estia Health (EHE AU) has entered a SID with Bain Capital at A$3.20 per share, a 49.5% premium to the undisturbed price (21 March).
The offer is attractive in comparison to historical share prices and multiples. The offer is also attractive in comparison to the Japara Healthcare (JHC AU) precedent transaction. 
The MAC clause, particularly around material regulatory events, could be risky. At the last close and for an end-of-December payment, the gross and annualised spread is 3.7% and 9.5%, respectively.


Estia Health (EHE AU): Bain Capital’s Binding Proposal

<ul>
<li>After its initial bid of $3.00/share was rejected by <a href="https://www.smartkarma.com/entities/estia-health-ltd" target="_blank" data-smartkarma-citation="entities:77:1" rel="noopener">Estia Health (EHE AU)</a>, Bain returned on the 7 June with a $3.20/share non-binding proposal and was granted exclusive due diligence.</li>
<li>Estia and Bain Capital have now entered into a Scheme Implementation Agreement at A$3.20/share, a 50% premium to undisturbed. </li>
<li>A shareholder meeting is expected to be held in November with implementation expected prior to the end of 2023. </li>
</ul>


After its initial bid of $3.00/share was rejected by Estia Health (EHE AU), Bain returned on the 7 June with a $3.20/share non-binding proposal and was granted exclusive due diligence.
Estia and Bain Capital have now entered into a Scheme Implementation Agreement at A$3.20/share, a 50% premium to undisturbed. 
A shareholder meeting is expected to be held in November with implementation expected prior to the end of 2023. 


<ul>
<li>On the 23 March, aged care provider <a href="https://www.smartkarma.com/entities/estia-health-ltd" target="_blank" data-smartkarma-citation="entities:77:1" rel="noopener">Estia Health (EHE AU)</a> announced Bain Capital's $3.00/share non-binding proposal. 12 days later, Estia rejected this indicative Offer. </li>
<li>Bain has returned with a A$3.20/share proposal, inclusive of a fully franked dividend up to A$0.12/share. A process deed has been entered into, and exclusive due diligence has been granted. </li>
<li>Trading at a gross spread of 10.7% with an indicative completion in early 4Q23.</li>
</ul>


On the 23 March, aged care provider Estia Health (EHE AU) announced Bain Capital's $3.00/share non-binding proposal. 12 days later, Estia rejected this indicative Offer. 
Bain has returned with a A$3.20/share proposal, inclusive of a fully franked dividend up to A$0.12/share. A process deed has been entered into, and exclusive due diligence has been granted. 
Trading at a gross spread of 10.7% with an indicative completion in early 4Q23.


Australia

Estia Health Limited provides aged care services. The Company operates a network of retirement homes, providing housing, nursing, food preparation, community building, and related services. Estia Health serves residents throughout Victoria, Australia.

Estia Health (EHE AU)

Estia & Bain: 15th Nov Shareholder Vote

This is trading super tight at 0.6%/5% gross/annualised. Stay in if already in. But with the risk-free rate >4%, I'd be a buyer (much) lower, not...

David Blennerhassett