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Abano uses dividend for takeover costs

NZ Newswire logoNZ Newswire 22/01/2017 Paul McBeth

Abano Healthcare has used Healthcare Partners Holdings' interim dividend to offset the cost of a partial takeover bid by the medical investor's biggest shareholder.

Auckland-based Abano has applied the 16 cents per share interim dividend payable to Healthcare Partners to the mounting bill associated with the group's partial takeover offer. The board has recommended investors reject the offer.

Healthcare Partners, an entity owned by cornerstone shareholders Anya and Peter Hutson and James Reeves, held about 19 per cent of Abano's stock when it mounted a $10-per-share offer for 50.01 per cent of the healthcare company, including the interim dividend.

The Hutsons and Reeves want to improve the company's performance by halting acquisitions in the medium term in order to reduce debt, while improving the dental practices' operations. Since mounting the bid, Healthcare Partners has attracted acceptances totalling about 1 per cent of Abano's shares.

Abano on Monday said it has incurred more than $700,000 in costs responding to the partial takeover bid, but hasn't received any payments or acknowledgement for invoices issued since November.

"It has now been two months since the second takeover notice was withdrawn by Healthcare Partners and no costs for these notices have been reimbursed since the first or second withdrawn notices," Abano said

"To ensure Abano's shareholders do not continue to be disadvantaged, Abano has withheld from Healthcare Partners the 16 cent per share dividend paid by Abano today to shareholders, and applied it to the unpaid invoices in relation to costs incurred or committed to prior to Healthcare Partners' withdrawal of their second notice in November 2016."

Healthcare Partners' dividends would have totalled $653,339.08, and Abano said there is still an outstanding debt of more than $185,000.

Abano shares last traded at $8.60, and have gained 26 per cent over the past 12 months.

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