Recommended combination of
Assura plc (“Assura”)
and
Primary Health Properties PLC (“PHP”)
to be implemented by means of a takeover offer
under Part 28 of the Companies Act 2006
1. Background
On 16 May 2025, PHP announced a firm intention to make a cash and share offer for the entire issued and to be issued share capital of Assura pursuant to Rule 2.7 of the Takeover Code. On 13 June 2025, PHP announced that it had posted: (i) an offer document to Assura Shareholders (the “Original Offer Document“) and (ii) the Combined Circular and Prospectus to PHP Shareholders.
Capitalised terms in this Announcement, unless otherwise defined, have the same meanings as set out in the Original Offer Document.
2. Recommended Increased PHP Offer
The Boards of PHP and Assura are pleased to announce the terms of a recommended combination of PHP and Assura which will be implemented by way of an increased shares and cash offer (the “Increased PHP Offer“) pursuant to which PHP will acquire the entire issued, and to be issued, ordinary share capital of Assura (the “Combination“).
Under the terms of the Increased PHP Offer, Assura Shareholders would receive, for each Assura Share:
0.3865 New PHP Shares
and
12.5 pence in cash
In addition, Assura Shareholders would be entitled to receive a special dividend of 0.84 pence per Assura share (the “Special Dividend”)
Based on the PHP closing share price of 103.5 pence on 20 June 2025, being the last Business Day before the date of this Announcement, the Increased PHP Offer of 0.3865 new PHP shares and 12.5 pence in cash, and, in addition, a 0.84 pence Special Dividend implies a total value to be received by Assura Shareholders on completion of the Combination of 53.3 pence for each Assura Share.
This represents a premium of 5.8 per cent. to the value of the best and final cash offer of 50.42 pence per Assura Share, made by Sana BidCo, a newly formed company indirectly wholly owned by (i) funds advised by Kohlberg Kravis Roberts & Co. L.P. and its affiliates and (ii) funds advised by Stonepeak Partners LP and its affiliates (the “Consortium” and the “Final Consortium Offer“).
In addition, Assura Shareholders will be entitled to receive or retain the following dividends which have already been paid or declared:
- the declared quarterly dividend of 0.84 pence per Assura Share paid on 9 April 2025 (the “Assura April Dividend“); and
- the declared quarterly dividend of 0.84 pence per Assura Share due to be paid on 9 July 2025 (the “Assura July Dividend“).
The Assura April Dividend and the Assura July Dividend (together the “Assura Dividends“) total 1.68 pence per Assura Share.
Assura Shareholders, as shareholders in the Combined Group, are also expected to receive the PHP dividend payable in November 2025, on the usual timetable.
The Increased PHP Offer, together with the Special Dividend and the Assura Dividends, implies a total value of 55.0 pence for each Assura Share and values Assura’s entire issued and to be issued ordinary share capital at approximately £1.79 billion, representing:
- an increase of 2.2 per cent. to the value of the previous share and cash offer for the entire issued and to be issued ordinary share capital of Assura made by PHP set out in the Original Offer Document (the “Original Offer“);
- a premium of 47.1 per cent. to Assura’s closing share price of 37.4 pence on 13 February 2025 (being the last Business Day prior to the commencement of the Offer Period);
- a premium of 49.1 per cent. to the 1-month volume weighted average Assura Share price of 36.9 pence as of 13 February 2025 (being the last Business Day prior to the commencement of the Offer Period); and
- a premium of 45.6 per cent. to the 3-month volume weighted average Assura Share price of 37.8 pence as of 13 February 2025 (being the last Business Day prior to the commencement of the Offer Period).
Subject to full acceptance of the Increased PHP Offer, following completion of the Combination, Assura Shareholders would hold approximately 48 per cent. of the Combined Group’s issued share capital.
Commenting on the Increased PHP Offer, Harry Hyman, Non-Executive Chair of PHP said:
The PHP Board continues to believe in the strong strategic rationale of the Combination, which will create a leading healthcare focussed listed REIT with the scale and expertise to deliver significant benefits for the Shareholders in PHP and Assura.
The Increased PHP Offer, which is expected to deliver earnings accretion to both sets of shareholders, allows Assura Shareholders to participate in significant upside compared to crystalising value in cash at an inflexion point in the current economic cycle, and benefit from the Combined Group’s likely long-term rating, continuing capital growth and a growing dividend.
The PHP Board welcomes the recommendation of the Assura Board and, as a significant individual shareholder in PHP, I look forward to the significant value creation potential in the future from the Combined Group.”
Commenting on the Increased PHP Offer, Ed Smith, Non-Executive Chair of Assura said:
“Following recent engagement between PHP and Assura, PHP has today further increased the terms of its offer, and has also addressed some of the potential risks that Assura had previously raised.
The Assura Board has always been and will remain resolutely focused on carrying out its fiduciary duties in the interest of Assura Shareholders and in this context has decided to recommend this increased offer from PHP.”
A Mix and Match Facility is being made available to Assura Shareholders (other than Restricted Overseas Persons) in order to enable them to elect, subject to off-setting elections, to vary the proportions in which they receive cash and New PHP Shares in respect of their holdings in Assura. Further details of the Mix and Match Facility were set out in the Original Offer Document (as will be updated in a revised offer document to take into account the Increased PHP Offer (the “Revised Offer Document“)).
3. Recommendation
The Assura Directors, who have been so advised by Lazard, consider the terms of the Increased PHP Offer to be fair and reasonable. In providing its advice to the Assura Directors, Lazard has taken into account the commercial assessments of the Assura Directors. Lazard is providing independent financial advice to the Assura Directors for the purposes of Rule 3 of the Takeover Code.
The Assura Directors consider that the terms of the Increased PHP Offer are in the best interests of Assura Shareholders. Accordingly, the Assura Directors intend to recommend unanimously that Assura Shareholders accept, or procure the acceptance of, the Increased PHP Offer.
4. Background to and reasons for the recommendation
The recommendation follows careful consideration of the Increased PHP Offer by the Assura Board and its advisers, in conjunction with extensive consultation with Assura Shareholders following the announcement of the Final Consortium Offer on 11 June 2025 and the announcement by PHP on 13 June 2025 (which included a reduction in PHP’s acceptance condition from “75%” to “more than 50%” of the voting rights normally exercisable at a general meeting of Assura Shareholders, and the potential acceleration of Assura’s Q3 dividend). In addition, in making its decision the Assura Board and its advisers have reviewed the potential risks set out in Assura’s announcement on 11 June 2025 and have engaged in further discussions with PHP and its advisers regarding PHP’s proposed capital structure and disposal programme.
In relation to its proposed disposal programme, PHP has provided additional comfort to the Assura Board and confirmed that it is in detailed discussions with a number of highly credible investors regarding a planned joint venture in respect of Assura’s private hospital portfolio. The Boards of Assura and PHP have agreed that disposals should be undertaken in a timeframe that will ensure best value is achieved for shareholders and the Assura Board will take all reasonable steps to enable this to occur following Completion.
In relation to capital structure, the Assura Board notes (a) progress on the part of PHP in obtaining change of control waivers in respect of Assura’s revolving bank facility, thereby reducing the amount required under the acquisition facility, and (b) the agreement of a restated two-year maturity for Assura’s term loan from Barclays, plus additional extension options to 2029.
At the same time, the Assura Board recognises the benefits of a combination with PHP including: (i) that Assura Shareholders would remain invested in a larger and more efficient REIT, which would own a combined £6 billion portfolio of social infrastructure assets; (ii) that the combined group would allow Assura Shareholders to continue to benefit from the attractive long-term dynamics of the healthcare real estate sector; (iii) that Assura Shareholders, as shareholders in the Combined Group, would be invested in an enlarged company with increased visibility in the public markets, greater index weighting and improved share liquidity; (iv) that the transaction is expected to be earnings enhancing in the first full financial year post completion of the Combination for both companies’ shareholders on a pro forma basis, taking into account expected annualised, run-rate synergies and (v) the premium that the Increased PHP Offer represents compared to both Assura’s undisturbed share price and the Final Consortium Offer.
The Assura Board also recognises that the Increased PHP Offer contains a cash component and the entitlement to a Special Dividend (via the acceleration of Assura’s Q3 dividend). These cash elements allow Assura Shareholders to crystallise a meaningful portion of their current investment in cash, with flexibility under the Mix and Match Facility, while also allowing them to benefit from remaining invested in the Combined Group.
Against this background, having reviewed the potential risks and the increased benefits of the Combination for Assura Shareholders, the Assura Board has decided to recommend the Increased PHP Offer. Consequently, the Assura Board has withdrawn its recommendation of the Final Consortium Offer and advises Assura Shareholders to take no action in relation to the Final Consortium Offer.
5. Financing
The cash consideration payable by PHP to Assura Shareholders pursuant to the terms of the Combination will be funded by way of an unsecured loan to be made available pursuant to the terms of a facilities agreement (the “Facilities Agreement“) between (1) PHP, (2) Citibank, N.A., London Branch, The Royal Bank of Scotland Plc and Lloyds Bank plc as mandated lead arrangers, (3) Citibank, N.A., London Branch, Lloyds Bank plc and The Royal Bank of Scotland plc as original lenders and (4) The Royal Bank of Scotland Plc as agent, with a total aggregate commitments of £1,225,000,000 with a term of 30 months from the date of execution of the Facilities Agreement.
Further details in respect of the Facilities Agreement and these arrangements is included in the Original Offer Document (as may be updated, if necessary to take into account the Increased PHP Offer, in the Revised Offer Document).
Rothschild & Co and Deutsche Numis, in their respective capacities as joint lead financial advisers to PHP, are satisfied that sufficient cash resources are available to PHP to enable it to satisfy in full the cash consideration payable to Assura Shareholders under the cash element of the terms of the Increased PHP Offer.
6. Conditions to and further terms of the Increased PHP Offer
Save as set out in this Announcement, the Increased PHP Offer is subject to the same terms and conditions as set out in Part 2 (Conditions to and Further Terms of the Offer) of the Original Offer Document (including any post-offer intention statements under Rule 19.6 of the Takeover Code and any other disclosures contained in the Original Offer Document). The Increased PHP Offer is a revision to the Original Offer and should be construed accordingly.
In particular, the Boards of PHP and Assura note the following:
PHP shareholder approval and listing conditions
The PHP Board reminds Assura Shareholders and PHP Shareholders that, pursuant to Conditions 2.1 and 2.2, the Combination (as amended by the Increased PHP Offer) remains subject to: (i) the passing at the PHP General Meeting by the requisite majority of PHP Shareholders of the PHP Resolution and (ii) the listing conditions.
Foreign direct investment
The PHP Board further reminds Assura Shareholders and PHP Shareholders that, pursuant to Condition 2.3, the Combination (as amended by the Increased PHP Offer) remains subject to foreign direct investment approval in the Republic of Ireland. The PHP Board expects to receive this approval within the next 2 to 3 weeks.
Antitrust, competition and merger control
The Combination (as amended by the Increased PHP Offer) is not conditional on any antitrust, competition or merger control approvals.
7. Intentions of PHP and disclosures
Save as set out in this Announcement, PHP confirms that the Increased PHP Offer does not change its intentions as regards the business of Assura, including as to its employees, management and pension schemes and locations, as detailed in paragraph 14 of Part 1 of the Original Offer Document (Intentions of PHP with regard to Assura’s business, employees, and the Assura Pension Scheme).
Board and governance arrangements
It is intended that, following this Announcement of the Increased PHP Offer, the Boards of PHP and Assura will review the structure of the board and management of the Combined Group. No discussions have taken place on this matter to date.
PHP confirms that there have been no material changes to the offer-related arrangements and further confirms there has been no change to the disclosure of interests in Assura as set out in the Original Offer Document.
8. Revised Offer Document and Supplementary Prospectus
The Original Offer Document contains the terms and conditions to the Original Offer. The Revised Offer Document containing updates to those terms and conditions to reflect the Increased PHP Offer and any material updates since the publication of the Original Offer Document will be sent to Assura Shareholders as soon as reasonably practicable. The Revised Offer Document will include the opinion of the Assura Board on the recommended Increased PHP Offer and other relevant information required by Rule 25 of the Takeover Code.
The Revised Offer Document will contain a revised expected timetable of principal events in relation to the Increased PHP Offer.
A second form of acceptance and election (the “Second Form of Acceptance and Election“) will also be sent to Assura Shareholders together with the Revised Offer Document. However, Assura Shareholders who have already validly accepted the Original Offer will automatically be deemed to have accepted the terms of the Increased PHP Offer by virtue of their prior acceptance and, if applicable, to have made a Mix and Match Election in the same manner as indicated in such prior acceptance. Such Assura Shareholders therefore will not need to take any further action, and do not need to complete or return this Second Form of Acceptance and Election or make a further electronic acceptance.
The Combined Circular and Prospectus contains further information on PHP and the New PHP Shares. A supplementary prospectus updating the Combined Circular and Prospectus for the Increased PHP Offer and any other material updates since the publication of the Combined Circular and Prospectus (the “Supplementary Prospectus“) will be published and sent to Assura Shareholders as soon as reasonably practicable.
The Revised Offer Document, the Second Form of Acceptance and Election, and the Supplementary Prospectus will, subject to certain restrictions relating to persons resident in the United States and other Restricted Jurisdictions, be made available on the respective websites of PHP (www.phpgroup.co.uk) and Assura (www.assuraplc.com/investor-relations/shareholder-information/offer-from-php).
9. Dividends
Assura Dividends
Under the terms the Combination, as well as having received the quarterly dividend of 0.84 pence paid on 9 April 2025, Assura Shareholders will be entitled to receive or retain:
- the Assura July Dividend, being the declared quarterly dividend due to be paid on 9 July 2025 of 0.84 pence per Assura Share; and
- a Special Dividend of up to a maximum of 0.84 pence per Assura Share conditional upon the Increased PHP Offer becoming Unconditional and, if the Increased PHP Offer becomes Unconditional, will be paid to Assura Shareholders on the register of members of Assura at the applicable Dividend Record Time, further details of which will be set out in the Revised Offer Document.
If, on or after 16 May 2025 (being the date of PHP’s original firm offer announcement), any dividend, distribution and/or other return of capital or value, is announced, declared, made or paid in respect of the Assura Shares and with a record date on or before the Unconditional Date other than (i) the Assura July Dividend; and (ii) the Special Dividend, PHP reserves the right to reduce the value of the consideration payable for each Assura Share under the terms of the Combination accordingly by reference to the aggregate amount per Assura Share of all or part of any such dividend (or in the case of each of the Assura July Dividend and Special Dividend, to the extent it exceeds 0.84 pence per share) and/or distribution and/or other return of capital or value, in which case any reference in this Announcement to the consideration payable under the terms of the Combination will be deemed to be a reference to the consideration as so reduced.
Save in respect of any Assura Dividends, to the extent that such a dividend and/or distribution and/or other return of capital or value has been declared but reached the ex-dividend date but not been paid prior to the Unconditional Date, and such dividend and/or distribution and/or other return of capital or value is cancelled, then the terms of the Combination shall not be subject to change in accordance with this section.
Any exercise by PHP of its rights referred to in this section shall be the subject of an announcement and, for the avoidance of doubt, shall not be regarded as constituting any revision or variation of the terms of the Increased PHP Offer or the Combination. In such circumstances, Assura Shareholders would be entitled to retain any such dividend, distribution and/or other return of capital or value.
PHP Dividends
Under the ordinary timetable, quarterly dividends for each PHP Share are expected to be paid in each of August and November 2025.
PHP reserves the right to declare, make or pay any dividend or other distribution on or after the date of this Announcement and prior to the Unconditional Date provided that, in each case, such dividend or other distribution is declared, made and/or paid: (i) in accordance with PHP’s the ordinary course financial calendar, (ii) in accordance with PHP’s dividend policy at the date of this Announcement and (iii) in a manner consistent with past practice.
Taking account of the Assura July Dividend due to be paid on 9 July 2025, to the extent that completion of the Combination occurs before the ex-dividend date of 4 July 2025 of the PHP quarterly dividend expected to be paid on 15 August 2025 (the “PHP August Dividend“), PHP reserves the right to accelerate payment of the PHP August Dividend to ensure that the PHP August Dividend is received by PHP Shareholders on the register of members of PHP prior to the date of completion of the Combination.
Combined Group
Following completion of the Combination, the PHP Board expects the Combined Group to continue its progressive dividend policy. The PHP Directors expect that the dividend will continue to be paid quarterly, in keeping with PHP’s existing dividend timetable.
10. How to accept the Increased PHP Offer
Pursuant to the terms of the Increased PHP Offer, Assura Shareholders who have already accepted the Original Offer will automatically be deemed to have accepted the Increased PHP Offer, by virtue of their prior acceptance and do not need to take any further action.
Assura Shareholders holding Assura Shares in certificated form (i.e. not in CREST) who wish to accept the Increased PHP Offer and to make an election under the Mix and Match Facility should complete either (i) the First Form of Acceptance and Election accompanying the Original Offer Document dated 13 June 2025; or (ii) the Second Form of Acceptance and Election which will accompany the Revised Offer Document to be posted in due course.
Assura Shareholders holding Assura Shares in uncertificated form (i.e. in CREST) who wish to accept the Increased PHP Offer and to make an election under the Mix and Match Facility should do so electronically through CREST.
Assura Shareholders with any questions relating to this Announcement or the Revised Offer Document or the completion and return of the Second Form of Acceptance and Election (following their publication) should telephone the Receiving Agent, Equiniti, on +44 (0) 371 384 2414. Calls from outside the UK will be charged at the applicable international rate.
Assura Shareholders who have not yet accepted the Increased PHP Offer are urged to do so as soon as possible and, in any event, by no later than 1.00 p.m. (London time) on 12 August 2025 (London time).
Further details of actions to be taken by Assura Shareholders will be contained in the Revised Offer Document.
11. General
This Announcement should be read in conjunction with the full text of PHP’s firm offer announcement published on 16 May 2025, the Original Offer Document, the Combined Circular and Prospectus, the Revised Offer Document and the Supplementary Prospectus (when published), copies of which are (or will be) available on PHP’s website at www.phpgroup.co.uk and Assura’s website at www.assuraplc.com/investor-relations/shareholder-information/offer-from-php.
Rothschild & Co. and Deutsche Numis (as joint lead financial advisers to PHP) have each given and not withdrawn their consent to the publication of this Announcement and the inclusion herein of the references to their names in the form and context in which they appear.
Peel Hunt and Citi (as joint financial advisers to PHP) have each given and not withdrawn their consent to the inclusion herein of the references to their names in the form and context in which they appear.
Lazard, Barclays and Stifel (as financial advisers to Assura) have each given and not withdrawn their consent to the publication of this Announcement with the inclusion herein of the references to their names in the form and context in which they appear.