ACQUISITION STRATEGIES
Ascendis selloff attributed to scandal over Steinhoff
Investor paranoia about offshore acquisition strategies that resemble Steinhoff’s has contributed to the recent sell-off of Ascendis Health’s shares, analysts say. The share price of the acquisitive healthcare group, headed by Karsten Wellner, is down 21% in 2018 at R13.90. It has nearly halved since its high of R26 in May 2017. Ascendis’s R750m rights issue in December, the stronger rand, concern about the company’s high debt and market unease about debt-funded offshore acquisitions are probably to blame for the continued sell-off, said Sasfin Securities senior portfolio manager Nesan Nair. "I think any business that embarked on an offshore expansion that was fuelled by debt kind of smells like Steinhoff," Nair said. There were many examples of this otherwise legitimate strategy in SA, he said. "People are just hypersensitive to the Steinhoff [scandal]," said Nair. Ascendis’s debt-funded takeovers include Cypriot company Remedica and European sports nutrition firm Scitec, both of w...
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