Genesis Capital has lraised its buyout offer to $1.75 per share, from the $1.40 per share bid rejected in mid-December and the board is likely to recommend it to shareholders.
Genesis Capital, which holds 19.9 per cent of Pacific Smiles, has been given the all-clear to do further due diligence inside the company by the Pacific Smiles board, but this remains on a non-exclusive basis.The new proposal is at $1.75 per share, up from $1.40.Pacific Smiles operates 128 dental clinics in NSW, Victoria, Queensland and the ACT and employs 800 dentists and 1600 support staff.
Pacific Smiles last month reported that in the six months ended December 31 its operating revenues were up 10.3 per cent to $90 million compared with a year ago, with patient fees up 10.4 per cent to $147.1 million. Net profit after tax for the December half was $4.4 million, compared with $222,000 a year earlier.
Pacific Smiles is the last ASX-listed dental clinic group still operating as a standalone business in a sector that is still highly fragmented. Larger private equity group BGH Capital has been the main consolidator in the industry. BGH started with a buyout in 2020 of New Zealand-listed Abano Healthcare, which owned Lumino in NZ and Maven Dental in Australia. It then addedMost dental groups were under serious financial pressure when COVID-19 lockdowns and restrictions resulted in patient visits slowing substantially, but are now recovering.
Pacific Smiles told the ASX on Tuesday it had entered into a formal “process deed” arrangement allowing for some cost reimbursement for Genesis Capital, with confidentiality and standstill agreements in place while the extra due diligence occurs.
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