Abano extends Wellington pathology contract by a year in $26m deal
Abano Healthcare [NZX: ABA], the specialist medical investor facing a takeover bid from interests associated with its biggest shareholder, has extended its contract to provide Wellington district health boards with pathology services for another year.
Aotea Pathology has extended its contract with the Hutt Value and Capital & Coast district health boards until October 2015 in a deal worth just over $26 million, Abano said in a statement. The extension will give the DHBs some room to review their services as they look for the most cost-efficient means to source pathology and lab services in the region.
"The DHB review is important to ensure that there continues to be a professional, high quality medical service for the greater Wellington area, which provides best value for money," Abano managing director Alan Clarke said. "We hope that this may lead to longer term contract tenure which would be to the benefit of all parties."
The Abano unit got a three-year extension in 2010 worth $75 million. The locally-listed company holds a 55 percent controlling stake in Aotea Pathology, with the remainder held by Sonic Healthcare.
Abano shares were unchanged at $6.76 in trading today.