We retain a Sell recommendation on Ramsay Health Care Ltd (RHC). Ramsay Santé, (57% RHC/ 43% Credit Agricole), has made a takeover offer for Générale de Santé, which will cost RHC around $491m. Générale de Santé is a leading operator of private hospitals in France comprising 75 facilities (including 61 hospitals). Whether this acquisition will create shareholder value or not will be highly dependent on an improvement in the French funding environment, which will only be apparent over the long term. In our view, RHC is a quality business with good prospects for continued growth. However, we believe this is more than factored into the 12-month forward PE of around 25x, and we retain our Sell recommendation.