HPSC Inc. and GE Healthcare Financial Services last week announced that GE would acquire HPSC for about $72 million in an all-stock transaction, working out to $14.50 per share, according to an 8-K filed with the Securities and Exchange Commission.
HPSC, a small- and medium-ticket equipment lender specializing in dentistry, has been a periodic issuer of equipment ABS through its Gloucester Funding platform.
"We've been concerned about companies (as servicers) that are not rated, and if they were rated they would not have a high rating," said an equipment analyst at Moody's Investors Service. "This is a good thing from our perspective, now that there's a strong, rated servicer behind them."
HPSC's stock price spiked to its 52-week high of $14.40 from just over $9 on Monday last week. In August, HPSC announced in an amended 10-K that it had brought two previously off-balance securitizations back onto its books. The company attributed this to an accounting technicality that caused it to lose non-recourse sale treatment in the opinion of its auditor, Deloitte & Touche.