Healius, Jangho chairmen clear the air, agree to keep talking

By Sarah Thompson and Anthony Macdonald

14 Jan 2019 — 12:15 AM

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Oh to be a fly on the wall when Healius chairman Rob Hubbard met his company's biggest shareholder - and now suitor - on Friday night. 

Hubbard dialled into a call with Jango Group chairman Liu Zaiwang after a dramatic 10-day period that started with Jangho surprising Healius with a $3.25 a share indicative bid, only for Healius to return serve with a swift rejection. 

The principal-to-principal call saw both sides explain their position. Importantly, there was no new offer from Jangho or any sign that it had plans for one in the near term. The call was more designed to open the lines of communication, sources said. 

It's back to business for Healius CEO Malcolm Parmenter and chairman Robert Hubbard. But for how much longer?  Nick Moir

Sources on both sides of the deal said the two men found common ground and believed it was in both of their best interests to keep talking. There still seems to be some bruising, at least on the Jangho side, following the outburst of M&A activity. .

The question, though, is what exactly they will be talking about.

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Healius said it had no intention to pursue Jangho's proposal further last week, and sources said nothing had happened yet to change that position.

So the undertaking to keep talking may relate more to their positions as chairman and shareholder, rather than chairman and suitor, at least in the near term. 

But it would be naive to think both had completely moved on from the M&A situation. The two companies have bankers and lawyers engaged and there is scope for back channelling now that Jangho's intentions have been aired. 

Healius took exception to two parts of Jangho's offer; the price and terms. While it's easy enough to negotiate whether $3.25 represents a sufficient control premium, it's the terms that may require more work in the near term. 

In particular, was that Jangho's offer was made conditional on it obtaining Chinese regulatory approvals. That's something that may be hard to obtain without Healius' co-operation, creating a bit of a Catch-22 situation. 

UBS and King & Wood Mallesons are working for Healius, while Macquarie Capital and Minter Ellison are in Jangho's camp. Healius shares last traded at $2.76.