Australian Investment Blog

ASX:SRX 16/07/2018

Sirtex (SRX) takeover jumps another hurdle

Stock

Sirtex Medical (SRX) $32.00 as at 16/07/2018

Event

Sirtex today announced the U.S. Federal Trade Commission has approved the private equity buy out by Chinese firm CDH Investments. FTC approval is one of a number of hurdles the deal has had to overcome, after first bettering US listed Varian Medical System’s offer and then gaining Australian Foreign Investment Review Board approval earlier this month. The offer for $33.60/share is a huge 78% premium to the last traded price before Varian’s offer in January has been given the board’s approval, and now just faces either a rival bid or a shareholder revolt – seems unlikely given the premium being offered. Sirtex has been on a wild ride, falling over 50% in 2017 due to a profit warning late in the year among other issues. As a result, shareholders have welcomed the takeover news. Sirtex (SRX) Chart Sirtex Chart

Market Matters Take/Outlook

The stock is still trading at a 5% discount signalling the deal still has small hurdles to overcome, although we see this as unlikely and expect to see SRX disappear from the market in the not too distant future.

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