Japara (ASX:JHC) share price soars 18% on takeover news

Japara’s board is recommending shareholders vote in favour of a takeover offer.

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The Japara Healthcare Ltd (ASX: JHC) share price is gaining this morning after the company released the latest news of its takeover offer.

The offer would see the residential aged care operator acquired by Little Company of Mary Health Care Ltd (Calvary).

Right now, the Japara share price is 18.45% higher than its previous close. Shares in the company are currently swapping hands for $1.38 apiece.

Let’s take a closer look at today’s news from Japara.

Japara recommends accepting takeover offer

The Japara share price is shooting higher after it announced it’s entered a scheme of implementation deed for Calvary to purchase all Japara’s shares.

The Japara board has unanimously recommended shareholders vote in favour of the scheme.

The offer would see each Japara shareholder receiving $1.40 of cash per share. That represents a 75% premium on the Japara share price’s close on 29 April 2021.

The market first heard news of the acquisition on 30 April, leading the Japara share price to gain 26%.

The offer also represents an 81% premium on the 30-day volume weighted average price prior to 30 April.

Calvary is a Catholic not-for-profit organisation. It operates 14 hospitals, 17 retirement and aged care facilities, and a network of community care centres.

The scheme is conditional upon factors including Japara not receiving a better offer, an independent expert concluding the scheme is in shareholders’ best interests, and shareholder approval.

Japara shareholders will have the chance to vote on the scheme in October 2021.

Japara Healthcare share price snapshot

2021 has been a good year so far for Japara’s shares.

Right now, they’re trading for 121% more than they were at the start of the year. They are also swapping hands for 175% more than they were this time last year.

The company has a market capitalisation of around $311 million, with approximately 266 million shares outstanding.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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