Aged care interest remains after aborted acquisition

A large private healthcare operator is still interested in establishing a presence in aged care despite backing out of a bid to purchase Melbourne-based provider, Arcare.

Healthscope suspended trade last Wednesday in preparation for the acquisition only to announce that it had ceased discussions with Arcare’s owners. It is understood that Healthscope approached Arcare.

But Healthscope has not ruled out further efforts to move into aged care.

“Healthscope will continue to review growth opportunities which are complementary to its integrated healthcare model and that will enhance shareholder value, including potential entry to the aged care sector,” the company said in a statement.

The health provider currently operates 43 private hospitals and a pathology business in Australia, New Zealand, Singapore and Malaysia.

It is understood that Healthscope could use land on its existing hospital sites to develop future aged care projects.

Following the aborted acquisition attempt, Healthscope announced that it had achieved a net profit of $45.1 million in the first half of 2009-10.

Although some market analysts had predicted higher returns, Healthscope’s CEO Bruce Dixon said the company was in a strong position.

“Our underlying business performed strongly in the half, with revenue and market share growth across all divisions, reflecting both increased demand and the benefits of our investment in expanding our hospitals and the provision of new services,” he said.

Arcare operates 14 aged care facilities in Victoria and Queensland and employs more than 1,000 staff members.

“We are greatly disappointed that it didn’t go ahead,” said Arcare’s CEO, Mal Humphries. “The synergies between both businesses offered win-win possibilities.”