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  • PKS (PKS) looks set to acquire Australian healthcare software company Pavilion Health for the equivalent of $8.5 million
  • Pending the approval of its shareholders, the company will issue 65.3 million PKS shares to Pavillion Health shareholders as consideration for the acquisition
  • In addition to the expanded customer base and technical expertise it would bring, PKS believes the acquisition offers it an avenue to enter the hospital pathology market
  • PKS shares gained 19.2 per cent following the news and closed at 15.5 cents each

PKS (PKS) looks set to acquire Australian healthcare software company Pavilion Health for the equivalent of $8.5 million.

Pavilion operates globally under a software-as-a-service model providing audit and risk solutions to hospital and governing health bodies.

The transaction will be entirely in scrip, with 65.3 million new PKS shares to be issued to Pavillion Health shareholders. As at the share price of 13 cents per share on April 17, 2020, the transaction is valued at $8.5 million.

This consideration will equate to 35 per cent of the company’s equity and is subject to PKS shareholder approval at an Extraordinary General Meeting expected to be scheduled for May.

The acquisition will also trigger a board change, with Stephen Borness, former Chairman of Pavilion Health to join the PKS board. Neil Broekhuizen will retire from his position as a Director on the PKS Board.

Strategic acquisition

The strategic rationale behind the acquisition includes the expansion of PKS’s customer base by 59 per cent to over 190 customers. Pavilion also has customers in Ireland, Singapore, Fiji and in the Middle East which may facilitate PKS’s international expansion.

In addition, PKS believes the acquisition offers it an avenue to enter the hospital pathology market. Finally, PKS cited the combined capital, technical expertise, technology and experience as an opportunity to accelerate product development and growth.

PKS shares gained 19.2 per cent following the news and closed at 15.5 cents each.

PKS by the numbers
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