Main points: Capitol Health has announced an off market takeover...

Main points:

• Capitol Health has announced an off market takeover offer for Integral Diagnostics
• The offer equates to a total $52.2m of cash and 6.9 shares in Capitol for each Integral share
• Capitol has already accumulated 19.55% in pre bid acceptance agreements from a number of institutional IDX holders
• MergeCo is estimated to have underlying pro forma FY18 EBITDA of $64m; pro forma FY18 net debt of $70m (1.09x leverage) that is conservative which supports its refinance position
• New funding arrangements in place consisting of a bridging facility of $100m, supplementing Capitol’s existing $35m. Capitol’s unsecured notes will remain in place and following completion of the transaction “Capitol intends to refinance MergeCo’s debt.

Capitol Chairman Andrew Demetriou said: “The merger creates a compelling opportunity for both Integral and Capitol Shareholders through the creation of one of Australia’s leading providers of diagnostic imaging services, with a broad and diversified network.”
Support of major Integral Shareholders Certain shareholders of Integral have indicated their support for the Offer by entering into the following pre-bid acceptance agreements with Capitol pursuant to which they have collectively agreed to accept or procure the acceptance of 19.55% of Integral shares, in aggregate, into the Offer on or after the 5th business day after Integral releases its target's statement as notified by Capitol in the absence of a superior proposal:  Regal Funds Management, in relation to the 5.13% of Integral shares currently on issue, together with an obligation to procure the acceptance of an additional 4.91% of Integral shares into the Offer;  Adam Smith Asset Management in relation to the 3.25% of the Integral shares currently on issue;  Microequities Asset Management in relation to the 2.00% of the Integral shares currently on issue; and  Wilson Asset Management in relation to the 4.26% of the Integral shares currently on issue.

Champee