Ramsay Health Care Looks to France for Deals

SYDNEY--Ramsay Health Care Ltd. (RHC.AU) will almost certainly participate in further industry consolidation in France and has the financial firepower to do major deals, Australia's biggest private hospital company said Wednesday.

The French economy is likely to struggle for the next 12-to-18 months, creating opportunities to snap up assets from distressed owners, Christopher Rex, Ramsay's chief executive, told a conference Wednesday. "And you will almost certainly see us take advantage of that as they arise," Mr. Rex said.

With a net debt-to-operating earnings ratio of around 2.6 times, Ramsay could comfortably afford a deal, Mr. Rex said.

He later told journalists that the company could afford a company-transforming acquisition, but would likely need to tap the market for more funding if it ever pursued such a large deal.

"We do have a significant amount of headroom and obviously against the earnings of any capital that we acquire we can borrow further," he said. "But we're probably at a point where we would need to consider how we would fund beyond that point."

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