Just one week after announcing that it was in the running to acquire Australian hospital firm Healthscope Limited, Dallas-based Tenet Healthcare Corp. halted those efforts, saying it was unable to convince shareholders that the purchase would be a good idea.
In a statement released this week, Tenet cited the "premature disclosure of nonpublic information" about the potential deal as one of its reasons for backing out. According to a Dallas Morning News article citing a Reuters report, Tenet's offer was valued at $1.54 billion.
"Although the due diligence process has commenced, it is in the early stages and has not proceeded as quickly and completely as anticipated," Tenet's statement said. "Tenet has concluded that in order to eliminate a prolonged period of uncertainty and market speculation surrounding this possible transaction, it is best to withdraw from this process."
According to a Dow Jones article on the Wall Street Journal website, Tenet's stock fell 17 percent after confirming its bid last Tuesday, but rebounded the following day. The Morning News also noted that both a bid from private equity firms Kohlberg Kravis Roberts & Co., and a combined bid from private equity investors Blackstone Group, TPG Capital and Carlyle Group each were favored in the process over Tenet's bid.
To learn more:
- here's the Dallas Morning News article
- read the Dow Jones piece
- here's Tenet's statement
- here's Healthscope's reaction to Tenet's statement