Mediclinic fighting fit after Abu Dhabi ditches charges
PRIVATE hospitals giant Mediclinic was given a clean bill of health today by investors after the Abu Dhabi government said it would no longer be charging extra to use private health.
The government in Abu Dhabi decided to cancel a 20% co-payment for treatment at private facilities for t h o s e w i t h p r iv a t e me d i c a l insurance.
Mediclinic, which has a near-30% stake in UK private hospitals group Spire, has been lobbying for the change for some time, especially given that trading has been tough in Abu Dhabi.
South African group Mediclinic listed in London last year after buying UAEbased Al Noor Hospitals Group for £1.4 billion in a deal which gave it more exposure to Abu Dhabi.
The decision to scrap the copayment came as a welcome relief to shareholders as the stock shot up 139p, or 19%, to 870p.
However, Rae Ellingham at Charles Stanley, said the share price surge “seems excessive”, explaining: “The UAE is actually the smaller portion of Mediclinic’s business, generating just 15% of profit.”
Mediclinic was the stand-out performer on the blue-chip index as the Macron-inspired rally finally ran out of steam, causing the FTSE 100 to slide 36.79 points to 7251.93.
Insurance giant Legal & General was the FTSE’s big faller. The shares lost 14.9p, or 5.7%, to 246.2p after Credit Suisse rated the shares Underperform and said it is suffering from the new Solvency II rules.
Analysts at Exane BNP Paribas talked up the potential for a takeover at Diageo, which slipped 24p at 2237p.
They said that if private-equity firm 3G is still keen for a big deal after failing to buy Unilever with Kraft Heinz, the Johnnie Walker maker is the only large spirits maker available. However, it still sees AB InBev as a more likely buyer, but a bid could be years away.
Car dealer Pendragon motored 1.06p, or 3.2%, higher to 34.81p after a strong first four months of the year.
Oil services group Weir fell 56p to 1998p after going ex-dividend. It also said trading had been line with expectations in the first quarter. Rivals Wood Group and Amec Foster Wheeler agreed a £2.2 billion merger last month. @jamienimmo63