Sharechat Logo

Orion's independent directors recommend takeover offer

Wednesday 6th March 2019

Text too small?

Orion Health’s independent directors are unanimously recommending founder Ian McCrae’s $1.224 per share takeover offer, saying it is about the mid-point of the valuation range arrived at by KordaMentha.

KordaMentha values Orion’s shares at $1-to-$1.47 each and the independent directors, Andrew Ferrier and Paul Shearer, say the offer price is also the same as the price offered in Orion’s share buyback, completed in January.

The health administration technology company’s shares are currently trading at $1.21, significantly below the IPO price in December 2014 of $5.70.

But the relevance of the KordaMentha valuation is moot: at the time the offer was made, shareholders with more than 90 percent of Orion’s shares had already accepted McCrae’s offer.

That means McCrae’s takeover vehicle, Grafton Health Holdings, is entitled to compulsorily acquire the remaining shares.

The majority of Orion’s shareholders took up the share buyback after they voted in favour of a radical overhaul of the company that has had a chequered career in the four or so years it has been NZX-listed.

McCrae had hoped his company would profit from the United States’ Affordable Healthcare Act, colloquially known as Obamacare after the former President Barrack Obama because it was his signature piece of legislation.

However, changes to the healthcare law initiated by the Republican Party and current President Donald Trump forced many of Orion’s customers to cancel orders when their own funding ran out.

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Scales signals earnings growth from reshaped business
Steel & Tube cuts earnings outlook on margin squeeze, inventory restatement
Bankers' Assn says RBNZ bank capital proposals would hurt the economy
20th May 2019 Morning Report
NZD slightly weaker against Aussie after Liberals' surprise victory
Northland rail upgrade a strategic, not commercial investment - Aecom
Fed speechs, Australian election outcome to impact NZ markets
Infratil confident of Vodafone clearance; keen to keep Trustpower
MARKET CLOSE: NZ shares rise; trading quiet ahead of upcoming earnings
NZ dollar firms against the Aussie heading into federal election

IRG See IRG research reports