NMC Health share price soars after takeover interest

The healthcare group saw its share price climb higher on Monday after it confirmed that it had received takeover bids from private equity firm KKR and GK Investment.

NMC Health saw its shares rise by as much 21% on Monday after it confirmed that it had received ‘highly preliminary approaches’ in relation to potential takeover offers from private equity firm KKR and GK Investment.

However, the healthcare group said that despite receiving takeover bids, no formal discussions over the terms of either offer have taken place.

‘There can be no certainty that any offer will be made for the company, nor as to the terms on which any offer might be made,’ NMC Health said.

NMC Health is trading at £8.48p as of 15:55 (GMT).

Looking to buy NMC Health shares? Open a live or demo account with IG.

NMC Health launches legal review to discern shareholders holdings

Before the healthcare operator can accept any takeover offer, however, the company must first determine the precise shareholdings of three of its largest shareholders.

On Monday, the company admitted that it may have misreported the shareholdings of its billionaire founder Bavaguthu Raghuram Shetty, as well as two other controlling shareholders, Saeed Mohamed al-Qebaisi and Khalifa Butti al-Muhair.

The trio reportedly control around 47% between them, however, the company is launching a legal review to determine the size of the three shareholders stakes in the business.

NMC Health will need to have the legal review completed soon to be able to accept an offer from KKR or GK Investment, with the Takeover Panel setting a deadline of 9 March.

You can go long or short NMC Health with IG using derivatives like CFDs and spread bets.

NMC Health: Technical analysis

NMC shares have been hit hard over the past 17 months, with the stock losing 83% of its value since the August 2018 peak of £43.39, with 2019 a year to forget for shareholders, according to Josh Mahony, senior market analyst at IG.

Unfortunately, those declines have shown little sign of letting up, with the stock losing 46% last week alone. This has taken us into mid-2015 low territory of £6.83, with the price starting to consolidate around that level. This is unlikely to mark the end of the declines, with a downtrend clearly in play here.

The ability to break through £10.96 would bring about a signal that things could start looking more optimistic over the short-term. However, even such a rise would point towards a retracement of the decline from £18.25 rather than an overall reversal, Mahony said.

'With that in mind, short-term declines look likely unless the price rises through the £10.96 level,' he added. 'Only with a break through the £18.25 level would we start looking towards a wider recovery in this stock.'

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.