News & Media

Acquisition of AH Medical Properties Plc

19.01.2011

The Acquisition will create the UK’s largest listed primary care medical property and pharmacy group with property assets of £504 million, an internally-managed, cost-efficient operating structure and access to an attractive pipeline of future investment opportunities.

Highlights

  • The Offer will be on the basis of 0.85 new Assura Shares for each AHMP Share
  • There is a cash alternative of 40 pence per AHMP Share, subject to the aggregate amount of cash payable under the Cash Alternative being limited to £10.5 million
  • The Offer values each AHMP Share at 39.2 pence and the existing issued and to be issued share capital (including the Convertible Loans) of AHMP at approximately £28.3 million
  • The Offer represents a premium 1 of: 22.5 per cent. over the Closing Price of an AHMP Share of 32 pence on 9 August 2010 (being the last Business Day prior to the commencement of the Offer Period); and 3.2 per cent. over the Closing Price of an AHMP Share of 38 pence on 18 January 2011 (being the last Business Day prior to the date of this announcement)
  • The Assura Directors believe that the Acquisition will be earnings per share enhancing in the first full year following completion2
  • Assura has received irrevocable undertakings to accept, or procure the acceptance of, the Offer from certain AHMP Shareholders in respect of, in aggregate, 50,024,603 AHMP Shares, representing approximately 76.2 per cent. of AHMP’s existing issued share capital. As 41,031,747 AHMP Shares are additionally subject to irrevocable undertakings not to elect for the Cash Alternative, the Cash Alternative is sufficient for all other AHMP Shareholders to receive their entire consideration in cash should they so elect
  • Assura is proposing to raise approximately £11.4 million (before expenses) by way of the Open Offer and approximately £12.0 million (before expenses) by way of the Firm Placing through the issue of 52.1 million new Assura Shares at 45 pence per share in order to provide funding for the Cash Alternative, for future acquisition and development opportunities for the Enlarged Group and for the costs of the acquisition
  • Assura has also entered into a number of arrangements with Ashley House whereby, subject to the satisfaction or waiver of certain conditions (including the approval of the Independent AHMP Shareholders), Assura will:
    • acquire three development properties from Ashley House;
    • grant a period of exclusivity to Ashley House to undertake due diligence into Assura’s LIFT operations (but not investments);
    • receive a right of first refusal to acquire all future projects developed by Ashley House for a period of six months;
    • make a loan to a joint venture special purpose vehicle established by AHMP and Ashley House to develop land at Scarborough; and
    • conditional upon the Offer becoming unconditional in all respects, terminate Ashley House’s existing asset management agreement with AHMP.
  • The Independent AHMP Directors, who have been so advised by Altium, consider the terms of the Offer to be fair and reasonable and will unanimously recommend that all AHMP Shareholders accept the Offer

Commenting on the Offer, Rodney Baker-Bates, Chairman of Assura, said:

“This transaction, which is expected to be earnings enhancing, will create the leader in the UK primary healthcare property investment market. It combines two high quality medical property portfolios generating excellent returns and enables us to deliver improved value to existing and new shareholders by leveraging our cost-effective, internally-managed structure. We are also pleased to benefit from AHMP’s three development opportunities, as well as the pipeline provided from our arrangements with Ashley House.”

Commenting on the Offer, John Gunn, Chairman of AHMP, said:

“The Board is pleased to have delivered a positive outcome for shareholders since the business’ inception in late 2004 and particularly since early 2007, when new shareholders came on board. Since 2008 the commercial property and indeed financial markets have been

difficult so to have come through such a period and delivered a positive total shareholder return is a source of satisfaction.”

1 Based on the value of an Assura Share at the Closing Price of 46.125 pence on 18 January 2011 (being the last Business Day prior to the date of this announcement).

2 Nothing in this announcement is intended, or is to be construed, as a profit forecast or should be interpreted to mean that earnings per Assura Share for the current or future financial years will match or exceed the historical earnings per Assura Share.