HomeTop StoriesRegulator signals concern over Australian Clinical buyout bid for Healius

Regulator signals concern over Australian Clinical buyout bid for Healius

(Reuters) – Australia’s competition watchdog expressed concern on Thursday over the A$1.52 billion ($1.03 billion) takeover bid from Australian Clinical Labs for medical center operator Healius, which had rejected the offer in May.

The Australian Competition and Consumer Commission (ACCC) said the acquisition would reduce competition in pathology services markets.

“The significant reduction in competition could lead to adverse consequences for patients, including lower levels of bulk billing, higher out-of-pocket payments for privately billed services, collection center closures, less frequent sample collection or longer turnaround times,” ACCC Commissioner Stephen Ridgeway said in a statement.

In a separate statement, Healius said that given the ACCC’s concerns, it is unlikely the regulator will clear a deal.

The board of Healius continues to recommend to its shareholders that the offer be rejected.

Australian Clinical Labs, one of the country’s largest pathology service providers, has been pursuing Healius shareholders to accept the offer after rejecting the offer, saying it had “no cash and no premium” and was “clearly inadequate”.

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The ACCC statement was expected due to the nature of the acquisition, Australian Clinical Labs said.

($1 = 1.4775 Australian dollars)

(Reporting by Navya Mittal in Bengaluru; additional reporting by Harish Sridharan; editing by Sherry Jacob-Phillips and Subhranshu Sahu)

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