Ramsay Health’s French Unit Is Planning to Raise Capio Offer

(Bloomberg) -- Ramsay Health Care Ltd.’s French subsidiary is planning to increase its 6.85 billion kronor ($780 million) offer for Capio AB after the Swedish health-care services firm rejected its initial bid this month, people familiar with the matter said.

Ramsay Generale de Sante could submit a fresh bid in the coming days, the people said, asking not to be named as the details aren’t public. The firm has lined up financing for a higher offer and is also considering a potential capital increase for a deal, they said. Discussions about the offer are ongoing and no final decisions have been made, they said.

Representatives for Ramsay Health, Ramsay Generale, and Capio declined to comment.

Capio rejected Ramsay Generale’s cash offer of 48.50 kronor per share, saying it didn’t reflect the company’s value. Capio’s shares fell 19 percent in the year ending July 12, the last trading day before Ramsay Generale’s offer was made public. They rose 1.9 percent to 53.60 kronor at 11:30 a.m. in Stockholm on Wednesday.

The French company wants to combine with Capio to create a top, pan-European hospital operator spanning six countries. Capio said last month that it was considering a sale of its non-Nordic operations and that it had been approached by bidders for its business outside of the region.

Last week, Capio reported adjusted earnings before interest, taxes, depreciation, and amortization of 262 million kronor for the second quarter, missing the lowest analyst estimates, according to data compiled by Bloomberg. The Gothenburg-based company said it had to do more extensive restructuring than originally planned in Germany, and was recording the costs in the second and third quarters.

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