Ramsay Health Care Limited · ASX:RHC
Ramsay Health Care — Merger or Acquisition (May 2021)
37 slides from Ramsay Health Care's merger presentation, May 26, 2021
Slide 1: ASX Announcement: Presentation and Speech – Recommended Cash Offer for Spire
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION ASX ANNOUNCEMENT 26 May 2021 PRESENTATION AND SPEECH – RECOMMENDED CASH OFFER FOR SPIRE HEALTHCARE GROUP Ramsay H
Slide 2: Proposed acquisition of Spire Healthcare plc
2021 International Year of Health & Care Workers Ramsay Health Care Proposed acquisition of Spire Healthcare plc Creating a best in class private healthcare provider in the UK 26th May 2021
Slide 3: Important information
Important information THIS PRESENTATION AND ITS CONTENTS ARE NOT FOR RELEASE, PUBLICATION, FORWARDING OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION (BY ANY PERSON OR ENTITY) WHERE SUCH RELEASE, PUBLICATION, FORWARDING OR DISTRIBUTION WOULD CONSTITUTE A
Slide 4: Agenda
Agenda 1. Transaction Overview 2. Strategic Rationale 3. Group Benefits & Financing Segment Performance 4. Next Steps 5. Q&A Group Performance Overview Segment Performance For further information please contact: Kelly Hibbins Group Head of Investor Relations Phn: +61 414 609192 Email: HibbinsK@ramsa
Slide 5: Transaction Overview
Transaction Overview Managing Director and CEO Craig McNally
Slide 6: Proposed Transaction Overview
Proposed Transaction Overview Transaction Details • Offer price of 240 pence sterling per share in cash • Represents a premium of 24.4% to the closing share price on 25th May • Represents a premium of 47.6% to the volume weighted average Spire share price over the 180-day period ending 25th May • Th
Slide 7: Benefits of the Transaction
Benefits of the Transaction Transforms UK platform to deliver growth and enhanced shareholder returns Combines two complementary private healthcare providers to create a leading Creates a leading independent platform across the UK which will better serve both public and independent healthcare privat
Slide 8: Delivering for the UK Healthcare Sector
Delivering for the UK Healthcare Sector Enhanced partnerships with our clinicians, the NHS & private health insurers to better serve UK patients Creating an enhanced offering for private patients Reinforcing valuable partnership with the National Health Service (NHS) Working with our doctors and
Slide 9: Strategic Rationale
Strategic Rationale Ramsay Health Care UK CEO Andy Jones
Slide 10: Key Statistics on the UK Market
Key Statistics of theon UKtheMarket UK Market . Highest demand for self-pay is in the £1.1bn 55-64 age group Annual value of private As of March 2021 there were healthcare self-pay market (inc. cosmetic surgery) 5m 1.5m PLUS PATIENTS PATIENTS (32%) £636m Waiting for planned NHS surgery2 Annual value
Slide 11: Long-term demand underpinning investment thesis
Long-term demand underpinning investment thesis Growth fundamentals underpinned by continued private demand and NHS waiting lists The £5.8 billion³ private acute care sector is driven by: Increased demand from both publicly and privately NHS outsourcing Private demand funded patients due to the COVI
Slide 12: Ramsay UK today
Ramsay UK today The leading provider of independent hospital services to the NHS • Ramsay UK operates 37 facilities Ramsay UK Earnings History Admissions by Key Services $’m including 3 neurological rehabilitation 943 930 24% 28% 874 Orthopaedics centres and a mobile diagnostic 782 755 738 General S
Slide 13: Creating a leading private healthcare services provider in the UK
Creating a leading private healthcare services provider in the UK1 A stronger platform with a wider-reaching footprint of services in the UK Combined network of hospitals and clinics across the UK3 Spire Operational metrics² Ramsay UK Hospitals 39 34 Clinics 8 3 Patients4¹ 261k 207k Doctors & 7,500
Slide 14: Combining the strengths of two highly complementary independent healthcare operators
Combining the strengths of two highly complementary independent healthcare operators¹ Improving capacity utilisation and diversifying payer sources and case mix Spire is an acute care provider in the UK, with Ramsay is an independent healthcare provider to significant exposure to Private Medical Ins
Slide 15: Improved patient-centric integrated care
Improved patient-centric integrated care Better patient outcomes through further investment in digital innovation & clinical excellence Ramsay’s Objectives What Spire brings Best-in-class UK independent healthcare provider Improved patient Extended Further investment in Cohesive disease access & nav
Slide 16: Supporting the NHS during the COVID-19 Pandemic
Supporting the NHS during the COVID-19 Pandemic Ramsay and Spire have supported the NHS during the COVID-19 pandemic and the combined Group will remain a committed partner in the future 15
Slide 17: Combining talent, learning & best practices
Combining talent, learning & best practices Enhancing the employee value proposition to attract and retain talent Harnessing the best of both business and creating a caring, empowered and productive culture where both our people and patients are our top priority Key Opinion Leader contribution t
Slide 18: Group Benefits & Financing
Group Benefits & Financing Group CFO Martyn Roberts
Slide 19: Significant synergy benefit potential
Significant synergy benefit potential Synergy benefits of at least £26m per annum generated in year 3 onwards procurement savings increased benefits from pathway reduction of from network scale and capacity utilisation enhancement, administrative costs across Ramsay global driving volumes across lev
Slide 20: Financing Structure
Financing Structure Financing • Total enterprise value £2,064 million / A$3,707million (includes IFRS 16 lease liability of £750 million/A$1,328)¹ • To be funded from existing debt facilities, net of acquired gross debt (A$745m1) • Following completion of the transaction Ramsay will look to manage i
Slide 21: Next steps: from announcement to integration
Next steps: from announcement to integration¹ • Posting of scheme circular to Spire shareholders c.3 • Engagement with the UK Competition and Markets Authority weeks • Court meeting, general meeting, shareholder vote and court hearing to sanction the c.4 scheme weeks c.1 • Scheme of arrangement expe
Slide 22: Conclusion
Conclusion Managing Director and CEO Craig McNally
Slide 23: Transforms Ramsay's UK platform
Transforms Ramsay’s UK platform Positions the business to take advantage of future growth opportunities Creates a leading independent healthcare platform in the Creates expanded capacity to address the prevailing UK, extending our capabilities, reach and diversifying backlog of elective procedures i
Slide 24: Questions
Questions Strictly Confidential
Slide 25: Accompanying speech: cover, disclaimer, agenda
26 May 2021 RECOMMENDED CASH OFFER FOR SPIRE HEALTHCARE GROUP PLC – INVESTOR PRESENTATION ACCOMPANYING SPEECH Slide 1 – Cover Slide Good afternoon everyone and thank you for joining our conference call and webcast at such short notice. On the call today we have our Managing Director & CEO Craig McNa
Slide 26: Speech: agreement on recommended cash offer
As you will have seen, we announced today that we have reached an agreement with the Board of Spire Healthcare plc (Spire) on the terms of a recommended all cash offer of 240 pence per share, to acquire 100% of the issued share capital of Spire, by way of a scheme of arrangement. As you may know, Sp
Slide 27: Speech: irrevocable undertakings and CMA engagement
Spire directors who own Spire shares have irrevocably undertaken to vote in favour of the scheme. In addition, Mediclinic International (Mediclinic) and the former Chairman of Spire have provided irrevocable undertakings to vote in favour of the Scheme. Mediclinic’s irrevocable undertaking is subjec
Slide 28: Speech: capabilities, synergies and EPS accretion
It will also extend our core capabilities and improve patient access throughout the longitudinal care pathway, improving capacity for diagnostic imaging, whole pathway propositions and enhanced recovery programs. Importantly it will provide the foundation from which we can pursue further growth oppo
Slide 29: Speech: patient outcomes and strategic rationale
patient outcomes and experiences through bolstered partnerships with private insurers, the NHS and associated clinical networks. Importantly it will accelerate our strategies to meet the growing patient demand for more convenient healthcare such as remote or digitised healthcare services through gre
Slide 30: Speech: NHS waiting list and long-term demand
As at March 2021 there were around 5 million patients waiting for planned NHS surgery and this is expected to continue to rise further. Approximately 1.5 million patients have waited more than the referral to treatment target of 18 weeks with trauma and orthopaedics having the highest number of pati
Slide 31: Speech: Ramsay UK today
Slide 11 –Ramsay UK today If you look at Ramsay’s positioning in the UK market today it has a market share of approximately 8% compared to Spire’s 17%. We are however a leading provider of independent hospital services to the NHS - operating 37 facilities, including three neurological rehabilitation
Slide 32: Speech: complementary operators
Slide 13 – Combining the strengths of two highly complementary independent healthcare operators As Craig mentioned earlier, the acquisition of Spire will transform our UK business. From a financial perspective you can see on this slide that the combination of Spire with Ramsay’s UK business delivers
Slide 33: Speech: digital and clinical investment
The combination will provide us with the economics to invest in platforms that meet the growing demand for more convenient healthcare, including remote and digitised health services. In addition, the clinical expertise in both businesses will extend the reach of our capabilities throughout the longi
Slide 34: Speech: NHS support and talent
Both businesses provided specialist equipment, ventilators and PPE to the NHS and accelerated medical technology offering through the provision of virtual consultations, e-prescribing and remote radiology reporting. We are committed to continuing to provide this high level of support for the NHS pos
Slide 35: Speech: synergies and EPS accretion
We expect that bringing together the Spire and Ramsay UK businesses will deliver significant benefits of at least £26 million per annum from procurement, improved capacity utilisation and cessation of UK listing costs which will assist in delivering: o High single digit EPS accretion in FY24; and o
Slide 36: Speech: leverage, dividend and next steps
funding group leverage within our current investment grade credit rating target through capital management initiatives and/or a strategic review of the Ramsay Group portfolio of assets. We expect to retain our FY21 dividend payout ratio in line with historical levels. Slide 20 – Next steps – From an
Slide 37: Speech: conclusion
Slide 22 – Transforms Ramsay’s UK platform Before opening up to questions I would like to close by again emphasising the strong strategic and financial rationale for this transaction. We have been operating in the UK market for 15 years and for the majority of that time we have been looking for grow
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