Scheme meeting presentation 18 October 2019 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. THIS PRESENTATION SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SECURITIES IN ANY JURISDICTION, INCLUDING IN THE UNITED STATES OF AMERICA OR ELSEWHERE. This Presentation is qualified by, and should be read in conjunction with, the full information contained in the scheme document dated 3 October 2019 (the “ Scheme Document ”) . All capitalised terms shall, if not otherwise defined, have the same meanings given to them in the Scheme Document.
EQT and HMI Jointly Propose to Privatise HMI Group Summary Transaction Overview Scheme of arrangement ( “Scheme” ) to acquire all the issued ordinary shares (“ HMI Shares ” and Transaction structure each, a “HMI Share” ) in the capital of Health Management International Ltd (the “Company” or “HMI” ) (the “ Acquisition” ) (1) PanAsia Health Limited (the “Offeror” ), a special purpose vehicle incorporated under the laws of the Offeror Cayman Islands, indirectly controlled by EQT Mid Market Asia III GP B.V. ( “EQT GP” ) S$0.730 per HMI Share in cash (the “Cash Consideration” ) OR Scheme Consideration 1 new ordinary share in the capital of the Offeror (the “Offeror Share” ) at an issue price of S$0.730 (the “ Issue Price ”) per Offeror Share for each HMI Share (the “Securities Consideration” ) In the event that the aggregate number of HMI Shares that are elected for the Securities Consideration exceeds 686,218,454 HMI Shares (representing approximately 81.95% of all HMI Shares) (the “Maximum Number” ), the Adjustment Mechanism (2) will apply 1) More than 50% in number of shareholders of HMI ( “HMI Shareholders” ) present and voting at the Shareholder Approval Threshold Scheme Meeting (3) , and 2) 75% in value of the HMI Shares voted at the Scheme Meeting (3) (1) In accordance with Section 210 of the Companies Act, Chapter 50 of Singapore, and the Singapore Code on Take-overs and Mergers. (2) The Maximum Number will be allocated among the HMI Shareholders who elected for the Securities Consideration on a pro-rata basis according to the number of HMI Shares they hold, as at the books closure date to be determined, relative to one another. With regard to the HMI Shares elected for the Securities Consideration in excess of the Maximum Number, each relevant HMI Shareholder who elected for the Securities Consideration shall receive in cash an amount equivalent to the Issue Price of each Offeror Share which cannot be allotted and issued to such HMI Shareholder (the “Adjustment Mechanism” ). (3) The meeting of the HMI Shareholders to be convened to approve the Scheme. 1
Rationale for the Acquisition Opportunity for HMI Scheme Consideration represents an attractive premium to prevailing market prices Shareholders to realise Since its listing in 1999, the closing share price of HMI Shares has only exceeded the their investment at an Scheme Consideration on one trading day attractive valuation Opportunity to exit amidst low trading liquidity of HMI Shares StarMed commenced soft launch of its operations in September 2018 and the Company expects gestation start-up costs to be incurred for potentially up to three years StarMed start-up costs HMI Shareholders can avoid any potential share price volatility that may arise due to fluctuations in earnings as a result of the gestation start-up costs Access to an efficient Current healthcare sector is competitive and challenging, and the Company requires a source of capital in significant amount of capital for potential strategic investments support of the Partnering with EQT provides HMI with access to an efficient source of capital, as Company's future well as access to EQT’s global healthcare expertise and track record growth HMI Shareholders will have an option to elect for the Securities Consideration in lieu Scheme Consideration of the Cash Consideration, subject to the Adjustment Mechanism. However, the Offeror Shares are in a private offshore entity and subject to certain risks and restrictions as referred to in the Scheme Document 2
Opportunity for HMI Shareholders to Realise their Investment at an Attractive Valuation 1 Scheme Consideration represents an attractive premium to prevailing market prices (1) (S$) Scheme Consideration: S$0.730 per HMI Share +27.8% +29.7% +27.4% +24.8% +14.1% S$0.640 S$0.585 S$0.571 S$0.573 S$0.563 12-month VWAP to the Last 6-month VWAP to the Last 3-month VWAP to the Last 1-month VWAP to the Last Closing price on the Last Undisturbed Trading Day Undisturbed Trading Day Undisturbed Trading Day Undisturbed Trading Day Undisturbed Trading Day Source: Bloomberg, L.P. as at 14 June 2019. Up to and including 14 June 2019 (the “Last Undisturbed Trading Day” ), being the last full trading day immediately preceding the date on which the Company first released the holding announcement in respect of a (1) possible transaction, i.e. 17 June 2019. 3
Opportunity for HMI Shareholders to Realise their Investment at an Attractive Valuation (cont’d) Since its listing in 1999, the closing price of HMI Shares has only exceeded the Scheme 2 Consideration on one trading day (S$) (m) Share price reached a historical high 0.90 of S$0.75 on the back of a consolidation transaction 140.0 0.80 announcement (1) Scheme Consideration of S$0.730 per HMI share 120.0 0.70 0.60 100.0 0.50 80.0 0.40 60.0 0.30 40.0 0.20 20.0 0.10 – 0.0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 HMI share volume HMI share price Scheme Consideration Source: Bloomberg, L.P. as at 14 June 2019. An announcement was made on 11 November 2016 on HMI’s proposed consolidation of its ownership in Mahkota Medical Centre and Regency Specialist Hospital. (1) 4
Opportunity for HMI Shareholders to Realise their Investment at an Attractive Valuation (cont’d) Opportunity for HMI Shareholders who may find it difficult to exit their investment in the 3 Company due to low trading liquidity of HMI Shares Period up to and including the Last Undisturbed Trading Day 1-month 3-months 6-months Average daily trading 328,345 226,922 170,012 volume (1) Average daily trading volume as a percentage 0.04% 0.03% 0.02% of total outstanding HMI Shares (2)(3) Source: Bloomberg, L.P. as at 14 June 2019. (1) Calculated using the total volume of HMI Shares traded divided by the number of days on which HMI Shares were traded on the SGX-ST, with respect to the relevant period. (2) Calculated using the average daily trading volume of HMI Shares for the relevant period divided by the total number of HMI Shares in issue as at the Latest Practicable Date, expressed as a percentage. (3) Rounded to the nearest two decimal places. 5
Partnering with EQT for the next phase of growth …EQT has the expertise Current healthcare and track record to help sector is challenging… healthcare companies grow HMI has an established track Partnering with a strategic long- term investor will allow HMI to: record in developing and growing healthcare businesses , growing from a − Gain access to an efficient single hospital into a regional source of capital through a private healthcare provider committed equity line from EQT (1) Amidst intensifying competition and consolidation amongst the − Leverage on EQT’s global healthcare players, the network of advisors and Company requires a strong healthcare significant amount of capital investment track record for potential investments − HMI believes that EQT will Should the Company remain add value to HMI’s growth listed, raising capital strategy to become one of successfully may be highly the leading private dependent on market healthcare providers in the conditions , and entail higher region costs and potential dilution to the HMI Shareholders (1) Refer to the Scheme Document for further details. 6
Opinion of the Independent Financial Advisor (“IFA”) An extract of the opinion of Ernst & Young Corporate Finance Pte. Ltd., the IFA, to the Independent Directors of the Company, in the IFA Letter is set out below: “ Having considered the factors and the assumptions set out in this letter, and subject to the qualifications set out herein, we are of the opinion that “ the financial terms of the Scheme are fair and reasonable . Accordingly, we advise the Independent Directors to recommend that HMI Shareholders vote in favour of the Scheme at the Scheme Meeting. It is important that all HMI Shareholders read this extract together with and in the context of the IFA letter in full, which can be found in Appendix B to the Scheme Document. All HMI Shareholders are advised against relying solely on this extract, which is meant only to draw their attention to the conclusion and opinion of the IFA. 7
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