(Bloomberg) — China’s iKang Healthcare Group Inc. received a preliminary $1.5 billion acquisition offer from an investor group that includes its main rival, setting the stage for a face-off with the company’s chairman who earlier this year made a bid to take the health-care service provider private.
IKang competitor Meinian Onehealth Healthcare Group Co. said in a statement on Sunday that it was part of a group of investors that had submitted a non-binding proposal to buy iKang for $22 in cash per American depositary share. That price is about 24 percent higher than an August bid of $17.80 per ADS led by iKang Chairman Ligang Zhang.
Shares of Beijing-based iKang, which provides preventative health-care services such as medical examinations, closed at $16.77 last week in New York trading, giving it a market capitalization of about $1.1 billion. In a statement published on Sunday on the company’s official WeChat account, Zhang said he wouldn’t sell shares he owns or controls to any third party and called Meinian’s competing offer “undoubtedly hostile.”
“Currently, competition between iKang and Meinian Onehealth is becoming increasingly fierce,” said Zhang in the statement. “This takeover bid may be intended to create psychological disturbances to iKang’s employees, customers and partners and to obtain improper competitive advantage.”
The consortium’s offer is “in accordance with laws and regulations of both China and the U.S., and open and transparent, and there is absolutely no ‘hostile’ takeover,” said Meinian Chairman Yu Rong in an open letter published on Monday on the company’s official WeChat account.