Full diagnosis (ASX:IDX)which operates diagnostic imaging services in Australia and New Zealand, has obtained clearance from the Australian Competition and Consumer Commission (ACCC) for its proposed acquisition of Capitol Health. (ASX:CAJ)subject to the divestment of a key clinic in Melton, Victoria.
Capitol Health, headquartered in Melbourne, operates diagnostic imaging services in Victoria, Tasmania, South Australia and Western Australia. Its brands include Capital Radiology, Direct Radiology and Future Medical Imaging Group (FMIG). The company operates 61 imaging sites, 46 of which are located in Victoria.
The ACCC’s decision clears a major regulatory hurdle, paving the way for the merger of two of Australia’s largest diagnostic imaging providers. The sale of the Melton Clinic responds to competition concerns in the local market, where the ACCC was concerned the merger may have reduced bulk billing rates or increased prices for imaging services.
The acquisition, first announced on June 17, 2024, will take place via a plan of arrangement, with final approval from the Federal Court expected on December 10, 2024.
Upon approval, Capitol Health shares will be suspended from trading on December 11, Capitol shareholders will receive IDX shares on December 20, and the company will be delisted on December 23.
The acquisition will significantly expand Integral Diagnostics’ presence in the diagnostic imaging industry, adding 60 Capitol Health radiology locations to its existing network of 70 locations. The combined network will increase the group’s market presence in metropolitan and regional areas and strengthen its position in key growth markets.
The merger is expected to provide operational synergies and expanded service offerings.
Shares of IDX closed up 1.03% at $2.93 yesterday. CAJ shares closed up 2.7% at $0.38.
