Ramsay Health Care receives takeover bid, Westpac fined again, iron ore giants miss production targets

Ramsay Health Care takeover bid Westpac fined iron ore giants miss production targets ASX Westpac Santos CSL Rio Tinto BHP Woodside
KKR has lobbed a bid for private hospital giant Ramsay Health Care.

Investors in Ramsay Health Care (ASX: RHC) are buoyant this week after news was released global private equity giant KKR & Co Inc have launched a $20 billion takeover of the institution.

Since news of the deal broke, shares in Ramsay have risen just over 24% to sit at $80.

A group of investors, led by KKR, have agreed to fork out $88 per Ramsay share for total control of the ASX-listed company.

While talks are still pending and there are finalisations to be made, the proposed deal is expected to lead to the fourth-largest healthcare stock on the market being scraped from the ASX.

The proposal still requires shareholder approval, among other requirements, to proceed.

Westpac

Australian banking giant Westpac Banking Corp (ASX: WBC) unveiled on Thursday plans to write-off to zero the value of BT’s $122 million in superannuation goodwill.

This decision comes as the company believes the “carrying value of our superannuation intangible assets was reviewed and found to be no longer supportable”.

This isn’t the first bank to do this, with other major banks having disposed of their superannuation businesses for hundreds of millions of dollars in recent years.

BT Financial Group chief executive officer Matt Rady has previously said any costs which might be recovered from the merged fund as a result of the deal would be going to the benefit of BT super fund members and not Westpac, to make matters worse.

It has since been confirmed Westpac will obtain no monetary consideration when BT is ‘transferred’ to a brand new proprietor.

In further news on Friday, the federal court issued Westpac with a $40 million fine over accusations of charging dead customers.

This brings the total to $113 million in fines for the actions committed by the bank across six different matters.

The extent of its actions includes advice fees for deceased customers, matters relating to insurance in super, the sale of consumer debt to debt purchasers with incorrect interest rates, charging fees to deregistered company accounts and duplication of insurance policies.

Santos

Australian energy powerhouse Santos (ASX: STO) announced on Wednesday an on-market share buyback worth up to $250 million in a bid to target higher shareholder returns amid surging commodity prices.

Oil and gas prices have increased heavily since the Russian invasion of Ukraine that resulted in supply disruptions while demand continued to increase.

Santos’ share price closed at a two-year high of $8.32 on Tuesday, with the welcome news set to cause further positive surges.

Santos chief executive officer Kevin Gallagher believes “the current share price undervalues the company”.

The share buyback is expected to commence next month and be conducted throughout the year.

CSL

Australian global biotech leader CSL (ASX: CSL) has broken records this week after uncovering plans of its US$4 billion (A$5.44 billion) debt raise in efforts to fund the acquisition of Vifor Pharma.

Despite the news, the company still has investors keen after it managed to stay in the green this week.

CSL chief financial officer Joy Linton says the support has been pivotal.

“The strong support shown by investors towards our inaugural US dollar bond issue reflects positively on our track record of disciplined financial management, as well as confidence in our strategy to invest in our leading therapeutic capabilities and generate sustainable growth,” she said.

The debt funding looks set to enable the company to grow CSL’s earnings into new areas, while also using the money for general corporate purposes.

Rio Tinto

Australia’s leading iron ore exporter Rio Tinto (ASX: RIO) has unveiled news of a plummet in shipments in the year’s first quarter due to delays on expansion projects.

Reports suggest the projects have been heavily impacted by the COVID-19 pandemic, which means sourcing materials and labour is difficult to come by.

The iron ore exporter experienced an 8% drop in shipments from this time last year and 15% from the last quarter, having shipped just 71.5 million tonnes.

The production itself experienced a drop of 6% also, with the company production of iron ore sitting at 71.7Mt.

Rio Tinto chief executive officer Jakob Stausholm says the period was difficult.

“Production in the first quarter was challenging as expected, re-emphasising a need to lift our operational performance,” he said.

BHP

In more iron ore news this week, BHP Group (ASX: BHP) stocks have declined as estimates in the first quarter of the year weren’t reached with troubled iron ore production at fault.

The company hasn’t stopped there, with expectations of a further plummet in the next quarter due to anticipated worker absenteeism.

Despite this, the iron ore giant believes it is still on track to meet its full year fiscal production forecast and projected operating result.

The news hasn’t been kind to BHP this month, with Chile suing the company over alleged environmental damages caused by its operations in the Atacama salt flats.

On top of this, COVID-19 isolations and worker and environmental protests have halted success for the prominent mining giant.

Woodside

Woodside Petroleum’s (ASX: WPL) chief executive officer Meg O’Neill revealed on Friday the company is seeking to revive stalled mega gas projects.

Ms O’Neill specifically named Sunrise in the Timor Sea and Browse off the coast of Western Australia as stalled projects to be revived, as the world looks away from Russian energy supplies.

Ms O’Neill says taking all Russian exports out of the global markets would have a significant effect, especially given the time it would take for the global energy system to adapt.

“The ripples would be pretty far and widespread.”

“If Russia were to go out of the western energy system for the long haul, that would have consequences for our long-term thinking around demand and pricing,” she said.

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