IHH's subsidiary to acquire Bulgarian healthcare provider and merge with another

IHH Healthcare Berhad's subsidiary, Acibadem, has moved to become a leading private healthcare operator in Bulgaria through the acquisition of Tokuda Group, as well as a merger with City Clinic, in two separate deals worth a total of about 76 million euros (S$115.7 million).

In a filing to the Singapore Exchange (SGX) on Thursday, IHH said its 59.6 per cent-owned subsidiary, Acibadem Saglik Hizmetleri Ve Tic AS, had entered into a deal on Wednesday to purchase 100 per cent of issued and outstanding share capital of Tokushukai-Sofia EOOD and its subsidiaries (Tokuda Group), for 65 million euros.

Tokuda Group is the largest private healthcare service provider in revenues located in Sofia, Bulgaria. It operates a hospital, an outpatient medical centre, an international standard clinical research centre, a pharmacy and a hospice located in the city of Sofia.

The completion of the proposed acquisition is subject to certain conditions, including the competition clearance decision on acquisition of Tokuda Group and merger with City Clinic Group.

City Clinic Group, founded in 2010, is a leading high-quality integrated healthcare provider in Bulgaria, operating in Sofia, Varna and Burgas. It operates three hospitals and three outpatient centres and has the only Joint Commission International accredited hospital in Bulgaria.

Acibadem and IHH's indirect 30 per cent-owned subsidiary, Clinical Hospital Acibadem Sistina Skopje, will merge with City Clinic through approximately one-third acquisition of existing stake in City Clinic from existing operating partners for 10.97 million euros.

Under this proposed transaction, there will be a roll-over of the remaining City Clinic stake into a new combined entity where Acibadem will hold 76.5 per cent of share capital and City Clinic operating partners will own a 23.5 per cent stake.

Pending necessary approvals and satisfaction of certain conditions, the deals are expected to close within three months.

The combined integrated group after the acquisition and merger will operate under Acibadem City Clinic.

IHH says the proposed deals have no effect on its issued and paid-up share capital and substantial shareholders' shareholdings. It added that there will be no material effect on the earnings, net assets or gearing of IHH for the financial year ending Dec 31, 2016.