Orion Health’s independent directors are unanimously recommending founder Ian McCrae’s $1.224 per share takeover offer, saying it is about the mid-point of the valuation range arrived at by KordaMentha.
KordaMentha values Orion’s shares at $1-to-$1.47 each and the independent directors, Andrew Ferrier and Paul Shearer, say the offer price is also the same as the price offered in Orion’s share buyback, completed in January.
The health administration technology company’s shares are currently trading at $1.21, significantly below the IPO price in December 2014 of $5.70.
But the relevance of the KordaMentha valuation is moot: at the time the offer was made, shareholders with more than 90 percent of Orion’s shares had already accepted McCrae’s offer.
That means McCrae’s takeover vehicle, Grafton Health Holdings, is entitled to compulsorily acquire the remaining shares.
The majority of Orion’s shareholders took up the share buyback after they voted in favour of a radical overhaul of the company that has had a chequered career in the four or so years it has been NZX-listed.
McCrae had hoped his company would profit from the United States’ Affordable Healthcare Act, colloquially known as Obamacare after the former President Barrack Obama because it was his signature piece of legislation.
However, changes to the healthcare law initiated by the Republican Party and current President Donald Trump forced many of Orion’s customers to cancel orders when their own funding ran out.