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ACL, Healius saga enlivens fine art of M&A trade craft

Corporate and M&A
Jonathan Wenig portrait LORES

In an opinion article published in today’s AFR, corporate and M&A partner Jonathan Wenig writes that this week’s decision by the Takeovers Panel to deny Healius’ application to conduct proceedings in relation to an all scrip, nil-premium, off-market takeover bid by Australian Clinical Labs has highlighted M&A as something of a full-body workout.

While ABL has no role in this matter and Jonathan is upfront in describing his comments as simply “supposition, reflection and observation”, he says the public commentary from the bidder and target (and target shareholders) has had “a touch of flair and drama”.

“But most interesting are the M&A tactics on display – deployed explicitly, hinted at and implied,” he writes.

“Healius has been asking: why did ACL put forward this bid? The obvious answer is that the bidder is keen on the target assets, sees value in the synergies and believes it can extract more value from Healius’ business than the current custodians. That said, elements of the Healius response raises the question – implicitly or explicitly – about whether other tactics might be at play. What prospect of success might there be for a bid by a smaller player in the face of emphatic resistance from key shareholders, particularly when the pot isn’t being sweetened at all with a premium? What other reason might there be for making such a bid?”

M&A, Jonathan explains, is a game driven by commerce and strategy, merging analytical skills with people skills, IQ with EQ, put to use by a broad spectrum of advisers.

The article was prepared with the assistance of lawyer Kaitlin Boyd.

To read the full article, click here.

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