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Asian Healthcare Specialists prices IPO at S$0.23 per placement share
ASIAN Healthcare Specialists (AHS), a group of five doctors engaged in orthopaedic, trauma and sports services, is placing out 46.9 million new shares at S$0.23 apiece as part of a listing on the Singapore Exchange's Catalist board.
The placement aims to raise around S$9.5 million in net proceeds.
There is no public tranche, and trading will commence next Friday.
At S$0.23 a share and a post-placement share capital of 290 million, AHS will have a market cap of S$66.7 million upon listing.
Operating under The Orthopaedic Centre brand, the group's medical specialists perform knee and hip replacements, sports medicine and surgery, spine surgery, foot and ankle surgery and minimally invasive orthopaedic procedures.
In the 12 months ended Sept 30, 2017, AHS made a net profit of S$438,000, on revenue of S$11 million.
If the service fees paid to the group's specialists had been replaced with employment agreements during this period, net profit would have been S$4.46 million, AHS said. The specialists have since entered into employment agreements with AHS.
Based on the adjusted net profit of S$4.46 million in 2017 and after accounting for the new shares issued, the placement price of S$0.23 represents a price-to-earnings ratio of 15 times.
AHS intends to declare a dividend of not less than 50 per cent of net profit as dividends for its 2018 and 2019 financial years.
AHS's four clinics are visited by a good mix of local expats and Singaporeans, said executive chairman and chief executive Chin Pak Lin, who specialises in hip and knee replacement surgery.
Dr Chin told reporters on Thursday: "We are four years old, we cannot do it (an initial public offering) any sooner I think ... Why IPO? We've been approached by many many people in the market, and that piqued our interest."
The IPO proceeds will be used to help AHS grow into a one-stop integrated healthcare provider for all musculoskeletal-related medical care, including post-surgery rehabilitation services such as physiotherapy as well as other ancillary services such as pain management.
In the nearer term, plans are already underway to hire one or two more surgeons, Dr Chin said.
RHT Capital is the issue manager and sponsor for the listing. UOB Kay Hian is the placement agent.