Primary Health Properties (PHP) has outmanoeuvred a private equity consortium led by KKR and Stonepeak, securing a £1.79bn all-share-and-cash merger with Assura Group.

The agreed deal sees Assura reject a competing all-cash bid from KKR and Stonepeak in favour of PHP’s enhanced offer, which values Assura shares at 55.0p each, well above the private equity group’s 50.42p proposal. The merger will create one of the largest listed healthcare-focused REITs in the UK.

Under the terms of the agreement, Assura shareholders will receive 0.3865 new PHP shares and 12.5p in cash per share, plus a special dividend of 0.84p. The offer reflects a 47% premium to Assura’s share price before the offer period began in mid-February.

PHP will finance the deal through a £1.23bn loan facility, with the combined group aiming to leverage its expanded scale to drive efficiencies and growth in the healthcare real estate sector. Upon completion, Assura shareholders will own approximately 48% of the newly merged entity.

While the private equity consortium had posed a credible challenge, the Assura board ultimately deemed PHP’s revised proposal to be in the best interest of shareholders.

“The PHP board continues to believe in the strong strategic rationale of the combination,” the company said, “which will create a leading healthcare-focused listed REIT with the scale and expertise to deliver significant benefits.”

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