Spire Healthcare confirmed a £1billion takeover by private equity over the weekend, becoming the latest mid-cap firm to exit the London stock market.
The private hospital group accepted a 250p-a-share offer by a consortium comprising funds managed by Toscafund, Three Hills and Ares.
The FTSE 250 firm’s shares rose 3 per cent to 245p in early trading, bringing this year’s gains to 45 per cent.
The deal concludes a four-month-long process that saw the takeover deadline extended five times as Toscafund sought to finalise its financing arrangements.
It will also see an overhaul of Spire’s board, with chief executive Justin Ash stepping down and non-executive director and vice chair, Sir David Sloman, assuming the role of interim chief executive.
It will add to mounting fears that the London market is being raided by private equity firms, as a string of companies announce their exit from the London market.
Spire criticised Labour’s tax hikes as it leaves the London market following a £1bn takeover
Last week, a trio of mid-cap firms announced their intention to delist following takeover approaches. FTSE 250 industrials firm Bodycote and telecoms company Gamma Communications unveiled fresh offers capping months of interest in the companies.
Bodycote recommended a £1.85billion takeover by US private equity firm Veritas Capital, while UK buyout firm Epiris announced a £1.08billion takeover of Gamma.
Separately, Capricorn Energy announced a £292million takeover by Norwegian oil firm.
In a statement to investors, Spire pointed to ongoing macroeconomic volatility, inflationary pressures and ‘subdued’ investor sentiment in the UK.
Chair-designate Debbie White said: ‘There are further steps required to deliver the Company’s standalone plan and uncertainty and execution risk to doing so.
‘The long-term prospects for independent healthcare in the UK are strong, but the trajectory has demonstrated much volatility in recent years and the ongoing cost pressures have been material, including from increases in national insurance contributions and the national minimum wage.’
Toscafund, run by hedge fund tycoon Martin Hughes dubbed ‘the Rottweiler’, tabled its first bid on May 14 at a 66 per cent premium to Spire Healthcare’s closing price the previous day, valuing the company at around £1billion.
The British investment firm built a nearly 11 per cent stake in Spire while opposing a 250p-a-share offer by Ramsay Healthcare of Australia in 2021. It has since grown its holding to around 18 per cent.
In May, Spire said that while talks were at an early stage, the board ‘would be minded to recommend unanimously… the possible offer’ to shareholders.
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