UK buyout firm Duke Street Capital has had a £76.9 million (€114 million, $152 million) take-private offer accepted UK dentist Oasis Healthcare.
The mid-market firm has had its 82 pence per share offer accepted by the company’s board, which unanimously recommended it to the company’s shareholders.
However, Duke Street may yet face competition from ADP Healthcare Services, a UK-based trade rival. ADP, which is backed by Icelandic investor Kaupthing, is Oasis’s largest shareholder with a 13 percent stake, and said yesterday that it may make a bid for the remainder of the company.
Oasis’ share price soared 21 percent to 85 pence on the strength of the news at the close of the market, 3 pence above Duke Street Capital’s offer.
As part of the deal, Duke Street would take on Oasis’ debts of approximately £34 million, according to UK newspaper The Daily Telegraph, citing the company’s accounts.
Peter Taylor, managing partner of Duke Street Capital, said his company will need to invest substantially in acquisitions, tendering for new NHS contracts and driving private dental revenues across the portfolio.
“To capitalise on these and other opportunities, Duke Street believes that a significant investment will be required. Given the capital restrictions on Oasis, such opportunities may not be fully available while Oasis remains a publicly listed company,” he added.
A Duke Street Capital spokesman said: “A higher percentage of people keeping their teeth offers excellent longer-term growth prospects, while 40 percent of people have no access to a dentist, either NHS or private.” The lack of preventative dentistry is expected to lead to an increase in demand for treatment as the population expands and people consume an increasingly high-sugar diet, he added.
Duke Street came under fire yesterday from Angela Eagle, member of parliament for Wallasey and a Treasury committee member, who told the Treasury Select Committee investigating private equity that her constituency is facing 821 job losses from Burtons, a biscuit manufacturer owned by the buyout firm. She has met with the firm today, a source said.