KUALA LUMPUR — April 25, 2016: IHH Healthcare Berhad, which last week proposed to buy two healthcare providers in Bulgaria, is set to become the largest private healthcare group there.
TA Securities, in its review of the proposed acquisitions, said the buyout of Tokuda Group and City Clinic Group will add four hospitals (750 beds) and four medical centres to the IHH stable.
IHH’s acquisitions will be made by its 59.6%-owned subsidiary, Acibadem Sağlık Hizmetleri ve Ticaret A.Ş. (Acibadem) for a total consideration of RM437.3 million or RM600,000 per bed.
“The consideration appears to be attractive when benchmarked against IHH’s greenfield capex in emerging markets like China (RM2.5 million/bed), Turkey (RM2.0 million/bed) and India (RM0.9 million/bed).
“Further, we also gathered that both groups are EBITDA positive with the Tokuda Group (1 hospital) profitable and the City Clinic Group (3 hospitals) loss-making.
“The latter’s performance is warranted considering its shorter operating period of 3 years against the former’s 9 years,” TA Securities said in its review.
The proposed acquisitions will be undertaken by Acibadem City Clinic BV (Acibadem SPV), an SPV incorporated by Acibadem. It will operate under the name Acibadem City Clinic, with IHH holding an effective interest of 41.2 per cent.