S&P reaffirms Sirtex after new offer from Chinese manager

ASX-listed healthcare firm Sirtex, whose investors include some of Australia's leading fund managers, will remain in the S&P/ASX 200 after its US takeover has been postponed in light of a new offer.

Sirtex entered into a trading halt and then announced Chinese alternatives manager, CDH Investments, had made an offer to acquire 100% of the company at a price of $33.60 per share, subject to multiple conditions including approval by CDH's investment committee and Australia's Foreign Investment Review Board.

This offer is somewhat higher than the previous one made by US-based Varian Medical Systems, which was to acquire 100% of Sirtex at $28 per share.

While there is no certainty as to whether CDH's indicative proposal will become a binding one, Sirtex nonetheless successfully petitioned the court to seek an adjournment of the original scheme meeting, which was to take place on May 7.

At this stage, Sirtex's board said Varian's offer remains "in the best interests of Sirtex shareholders."

Because the meeting has been adjourned, S&P, which was set to remove Sirtex from the ASX 200 index and replace it with IDP Education, will no longer do so.

Sirtex has been subject to two class actions, which the Federal Court recently consolidated into one. The actions involve a 37% fall in share price on 9 December 2016.

William Roberts Lawyers alleged in August 2017 that Sirtex, which manufactures and distributes targeted radiation treatments for liver cancer, engaged in "misleading and deceptive conduct," which involved breaching its disclosure obligations when forecasting double-digit growth for sales of its flagship product in FY17.

It wasn't until December 9, the law firm added, that Sirtex issued a "downward revision of dose sales forecasts to the market, triggering a 37% slump in its share price to $16 at the day's close."

Sirtex's shareholders have included HSBC, J.P. Morgan, BNP Paribas, Carpe Diem Asset Management and Yarra Capital.

Read more: SirtexUSASXS&PAustraliaCDH InvestmentsUS-based Varian Medical SystemsBNP ParibasCarpe Diem Asset ManagementFederal CourtForeign Investment Review BoardHSBCIDP EducationJ.P. MorganWilliam Roberts LawyersYarra Capital
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