Huntsworth to go private in £400m cash deal

Huntsworth has agreed to sell itself for £400m to a US private equity firm so that the healthcare and communications company can grow through acquisitions.

The company has accepted an offer of 108p a share in cash from Clayton Dubiliere & Rice in a deal valuing its equity at £400m with an enterprise value of £524m. Huntsworth shares rose 53.5% to 110.5p at 14:09 GMT.

The offer is 50% higher than Huntsworth's closing price on 2 March and 42% more than the average price over the past three months. The deal, backed by the board and management, will require approval by at least 75% of shareholders at a meeting.

Huntsworth provides marketing and medical communication services to healthcare clients alongside a smaller communications arm that includes the PR firms Citigrate Dewe Rogerson and Red. The company reported headline annual profit up 27% to £39.1m and strong momentum in the current financial year.

Clayton Dubiliere said as a private company Huntsworth would have more opportunities to make opportunistic acquisitions. The firm said it would "assist Huntsworth operationally and … leverage its ability to access capital to facilitate future acquisitions by Huntsworth".

Huntsworth's chairman David Lowden said Huntwsorth was in a strong position on its own but that "the all-cash offer from CD&R represents a compelling opportunity for shareholders to realise an attractive cash value in respect of their shares."

US private equity firms have been buying UK companies to take advantage of the pound's weakness against the dollar and share prices subdued by Brexit. The buying spree raised questions about valuable businesses leaving UK ownership and potential job cuts.

Huntsworth said it was reassured that Clayton Dubiliere would not make material job reductions or changes to workers' employment terms. There will be no significant changes to the company's headquarters or places of business, it added.