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Ramsay Healthcare (ASX:RHC) - Managing Director & CEO, Craig McNally
Managing Director & CEO, Craig McNally
Sourced: Sydney Morning Herald
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  • Ramsay Health Care (RHC) is looking to raise $1.4 billion to enhance its financial position during the COVID-19 pandemic
  • The hospital operator will be raising approximately $1.2 billion through a placement and the remaining $200 million through a share purchase plan
  • The money will be used to repay debt and strengthen the company’s balance sheet and liquids position
  • Regarding yesterday’s announcement about easing the restrictions on elective surgeries, RHC’s hospitals are preparing to reintroduce some
  • The ASX 200 lister will now work closely with doctors on a staged reintroduction to consider the safety of patients and staff
  • RHC is currently in a trading halt and shares are trading for just over $64 each

Ramsay Health Care (RHC) is looking to raise $1.4 billion to enhance its financial position during the COVID-19 pandemic.

The hospital operator will be raising approximately $1.2 billion through a placement and the remaining $200 million through a share purchase plan.

Initially, the money will be used to partially repay the company’s debt facilities.

“The equity raising will strengthen Ramsay’s balance sheet and liquidity position, as well as increase financial flexibility during the unprecedented operating environment,” Managing Director Craig McNally commented.

“More importantly, it will ensure that we can continue to pursue our growth initiatives and position us to take advantage of other growth opportunities that may arise,” he said.

Placement

RHC will be raising approximately $1.2 billion through the issue of 21.4 million new shares at a price of $56 per share which represents a 12.9 per cent discount to the closing price of $64.29 on April 21.

Shares are expected to issued and trade on the ASX on April 28.

The placement will be fully underwritten by J.P. Morgan Securities Australia.

Share Purchase Plan

Following the placement, RHC will offer eligible shareholders the opportunity to participate in a $200 million share purchase plan.

Shareholders will be able to purchase up to $30,000 worth of new shares and while the exact price is not yet known, it will be less than the placement price.

The shares will also have a two per cent discount to the volume weighted average price of the five-days up to, and including, the closing date.

RHC has the right to accept applications that result in more than $200 million being raised.

The share purchase plan will open on April 29 and close on May 20. Shares will then be allocated on May 27, and can begin trading on the ASX on May 28.

Dividends

RHC has decided to temporarily suspend ordinary share dividend payments, however, those regarding to Ramsay CARES will not be suspended.

COVID-19 Update

Regarding yesterday’s announcement about easing the restrictions on elective surgeries, RHC’s hospitals are preparing to reintroduce some.

The ASX 200 company will now work closely with doctors on a staged reintroduction, taking into account the safety of patients and staff, and the capacity limitations outlined by the government.

Discussions are progressing with several State Governments about the capacity of its hospitals and the support that RHC will provide as part of the Government’s COVID-19 response.

“The Government support and the capital management initiatives will ensure Ramsay’s ability to maintain its extensive hospital platform intact and will position the company to support previously deferred elective surgeries as the operating environment normalises,” Craig said.

RHC is currently in a trading halt and shares are trading for $64.29 each in a $12.99 billion market cap.

RHC by the numbers
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