Primary Health Properties PLC (LSE:PHP, OTC:PHPRF) called on Assura Group (LSE:AGR) investors to "take no action" in response to their board's recommendation of a £1.7 billion takeover by New York-based private equity groups.
In a statement issued after the UK government's spending review, the London-listed healthcare centre developer said it is "considering its options", suggesting it may opt for a hostile bid – ie one not supported by the board of the target company's board.
PHP said Rachel Reeve's spending review was "positive for both the PHP and Assura businesses", as it included a 3% per year real-terms increase to the NHS day-to-day budget.
This is "equivalent to approximately £29 billion per year of additional funding", the FTSE 250-listed group said.
Furthermore, with Reeves confirming that the Department of Health and Social Care's 10-year plan on healthcare will be published soon, the PHP board consider this will be "equally positive and to provide a boost to primary care as the government shifts toward community, primary and preventive care in the future".
Assura announced on Wednesday morning that its board was recommending a bid from a consortium led by US investment groups KKR and Stonepeak, and rejected PHP's offer as being too risky.
"The board of PHP strongly disagrees with the Assura board's assessment and will set out its detailed views in due course."
PHP's rival bid, in early April, was for Assura shareholders to receive 0.3848 new PHP shares and 9.08 pence in cash for each Assura share, which was worth between £1.5 billion and £1.7 billion, based on the PHP share price that week.