Asklepios Can Lift Rhoen-Klinikum Stake, Cartel Office Sa

Asklepios Kliniken GmbH can buy more than 10 percent of rival German hospital operator Rhoen- Klinikum AG with some conditions, Germany’s Federal Cartel Office ruled.

Rhoen-Klinikum shares fell on the decision, which leaves an obstacle to Fresenius SE renewing its effort to acquire Rhoen- Klinikum. Fresenius ended its 3.1-billion-euro ($4 billion) bid last year after Asklepios acquired enough Rhoen-Klinikum shares to foil the takeover.

Asklepios can buy as much as 10.1 percent of Rhoen-Klinkim as long as it divests the Harzklinik hospital and an outpatient facility, the Bonn-based antitrust agency said in an e-mailed statement today. The stake in Rhoen-Klinikum would lead to market dominance in the German city of Goslar, the office said.

“It doesn’t really change anything,” Ingeborg Oie, an analyst with Jefferies International Ltd., said in a phone interview after the ruling. “I don’t think Asklepios will start divesting hospitals just to increase its stake slightly.” Asklepios already has built a blocking stake in Rhoen-Klinikum, she said.

Rhoen-Klinikum had readied a “war room” to prepare for a the decision, Chief Financial Officer Jens-Peter Neumann said in a March 7 interview in London. The Bad Neustadt an der Saale- based company will start negotiations with shareholders after the ruling, he said at the time.

Shareholder Approval

The foiled Fresenius bid left Rhoen-Klinikum with suppliers and competitors as major stakeholders: Asklepios, Fresenius, (FRE) medical-products maker B. Braun Holding GmbH and the investors in another hospital operator, Sana Kliniken AG. Any potential partner would face the same hurdle that blocked Fresenius -- a 90 percent threshold of shareholder approval for a deal.

If Fresenius wanted to make another bid there’s “really no way around all of these companies that own stakes,” said Oie.

The cartel office said in December it was concerned the Asklepios plan would endanger competition and patient choice, especially around Goslar.

Rhoen-Klinikum fell 3.1 percent to 16.26 euros at 12:30 p.m. in Frankfurt. Fresenius last year offered 22.50 euros a share.

To contact the reporters on this story: Eva von Schaper in Munich at evonschaper@bloomberg.net; Allison Connolly in Frankfurt at aconnolly4@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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