Pacific Smiles agrees to $303m bid from National Dental Care

Leading dentist chain Pacific Smiles has agreed to an all-cash takeover from National Dental Care which trumps a recent takeover bid from Genesis Capital.

Pacific Smiles agrees to $303m bid from National Dental Care.

Leading dentist chain Pacific Smiles has agreed to a $303m all-cash takeover from National Dental Care centres which has won the support of the board and trumped a rival and revised takeover proposal from Genesis Capital.

The bidding war over Pacific Smiles has been raging for months with Genesis lobbing a bid priced at $1.40 before Christmas and then in March upping that to an all-cash offer of $1.75.

However, on Monday Pacific Smiles said that NDC HoldCo, a subsidiary of National Dental Care, had come back with an offer of $1.90 per share which had won the support of the board who have now entered into a scheme of implementation deed with the bidder.

Shares in Pacific Smiles rallied more than 14 per cent to $1.865 on news of the higher bid.

In February The Australian’s Dataroom column reported that Pacific Smiles management was to start making presentations about the company to rival bidder Genesis Capital in the hope of extracting a higher offer from the suitor.

Management, led by recently appointed chief executive Andrew Vidler, was to highlight the value drivers of the Australian-listed dental care chain, which rejected an initial $1.40 per share bid by Genesis Capital in December.

At the time it was reported that Crescent Capital, which owns rival National Dental Care, continued to assess whether to launch its own bid.

Now that rival bid has emerged and trumped the one from Genesis.

Under the revised offer that has won Pacific Smiles boardroom support, National Dental Care will pay $1.90 per share.

The board of Pacific Smiles unanimously recommends shareholders vote in favour of the scheme at the scheme meeting, and the directors will vote all Pacific Smiles shares in which they have a relevant interest or which they control in favour of the scheme at the scheme meeting,” the company said in an ASX statement.

This bid will be supported subject only to no superior proposal emerging and subject to the independent expert concluding that the scheme is in the best interests of Pacific Smiles shareholders, and not withdrawing or adversely changing that conclusion.

Pacific Smiles will have the discretion to pay shareholders a fully franked dividend of up to a maximum of 12c per share with the cash consideration of $1.90 per share under the scheme to be reduced by the amount of any such dividend.

“It remains at the discretion of the Pacific Smiles board whether any permitted dividend is ultimately declared and paid. Any such permitted dividend will be considered by the Pacific Smiles board prior to implementation of the scheme,” the company said in its ASX statement.