UK’s Assura backs rival’s $2.4 billion offer over KKR-Stonepeak bid

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(Reuters) -British healthcare real estate investor Assura on Monday recommended rival Primary Health Properties’ new 1.79 billion pound ($2.4 billion) takeover bid, which trumps a lower offer from KKR and Stonepeak Partners.

The private equity firms and PHP have been competing over Assura for months, gradually sweetening their offers for the company that manages over 600 healthcare properties and whose customers include Britain’s state-backed National Health Service.

PHP’s latest 53.3 pence per share bid would give each Assura shareholder 0.3865 new PHP shares, 12.5 pence in cash per share, and a special dividend of 0.84 pence per share, the companies said.

By contrast, KKR-Stonepeak’s “best and final” offer put forward earlier this month included 50.42 pence in cash, retention of a 0.84 pence a share dividend paid by Assura in April, and an equivalent amount to be paid on July 9.

Assura, which had said PHP’s earlier offers posed “material risks and downsides” related to financing, execution, and asset quality, said the latest bid “addressed some of the potential risks”.

Panmure Liberum analysts also backed PHP’s bid as “clearly superior, both in economic terms and long-term strategic value”.

Shares in PHP fell about 3% by 0848 GMT, while Assura traded 0.5% higher.  

($1 = 0.7444 pounds)

(Reporting by Shashwat Awasthi in Bengaluru; Editing by Mrigank Dhaniwala and Barbara Lewis)