Community Hospitals in talks with bidders

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Community Hospitals, the private hospital group that Bupa failed to take over last year on competition grounds, yesterday confirmed that it is in talks with eight potential bidders, sending its shares up 15p to 565p.

Community Hospitals, the private hospital group that Bupa failed to take over last year on competition grounds, yesterday confirmed that it is in talks with eight potential bidders, sending its shares up 15p to 565p.

In the running for the business, which was valued at £200m before the recent bid rumours, are American and European groups, British companies with rival hospitals, as well as private equity houses. General Healthcare, the UK's largest private hospital owner, is thought to be the front-runner, although Community said yesterday it was "early days". Other interested parties are believed to include Westminster Health Care and Nuffield.

Community put itself up for auction following a ruling last month by Stephen Byers, the Trade and Industry Secretary, that Bupa was not allowed to buy it. Bupa was also instructed to sell the 26.8 per cent stake its advisers, Schroders Salomon Smith Barney, held within six months. Bupa is understood to be driving for a price for its stake above the 650p-a-share it paid. However, Community shares slipped at the end of last year to below the 550p mark, leading analysts to believe that a price of about 640p is likely.

Bidders include companies that would give the enlarged group as much of a share of the private hospitals business in the UK as the Bupa deal.

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