Firms in huge elderly care merger deal

With an ageing European population, and public health care systems under pressure due to the economic crisis, private companies see opportunities to grow in the elderly care sector.

According to national statistics institute INSEE, the number of people over 60 in France alone will reach 23.6 million by 2050, up from 15.6 million in 2012.

The deal, which the companies described as a friendly merger, sees Medica shareholders receiving 10 Korian shares for every 11 Medica shares owned. The deal represents a 15 per cent premium to Medica’s closing share price of 20.03 euros on November 15.

The companies said in a joint statement the deal would create a market leader better positioned to expand, more powerful to seize growth opportunities, and more diversified to respond to changing regulation in the industry.

The group would have leading positions in France, Germany, and Belgium, and be number two in Italy, with close to 40,000 employees and 600 facilities.