Radiology services provider Medica Group (LON: MGP) withdrew the final dividend resolution at its AGM. That means that it will not pay the 1.88p/share final dividend, which would have affected the bid price. Medica Group recommended a 212p a share cash bid from private equity firm IK Partners, which would have been reduced by the dividend amount. That was nearly one-third higher than the share price prior to the bid.
The share price has not been at this level since the end of 2017. The offer values premium-listed Medica at £269m. There is net debt of nearly £1m. Medica was expected to make a 2023 pre-tax profit of £15.2m and the bid represents 21 times prospective earnings.
IK Partners, which has focused on healthcare businesses, will be able to provide the funding to further invest in technology. Investee companies include Germany-based LAP Group, which provides laser positioning systems and quality assurance software and hardware used during radiotherapy.
Hastings-based Medica has operations in the UK, Ireland and the US. The backing of IK Partners will also help Medica to growth through acquisition in existing and new territories.
The bid scheme is set to become effective this month.