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Singapore Medical Group boosts ownership in Vietnam clinics

CATALIST-LISTED Singapore Medical Group (SMG) said on Tuesday that it has exercised its option to convert the convertible loan of US$689,360 granted to CityClinic Asia Investments (CCAI) into 177,670 shares of CCAI at the conversion price of US$3.88 per share.

Upon conversion, SMG will acquire an additional 65,647 shares from six existing shareholders of CCAI at a price of US$3.88 per share for a total cash consideration of US$255,000.

CCAI is an associate company of SMG incorporated in Singapore and is primarily involved in the business of providing business and management consultancy services, as well as investment holding.

SMG has an effective equity interest of 16 per cent in CCAI, held through its 50 per cent-owned jointly controlled company, SMG International (Vietnam) (SIV), which holds a 32 per cent interest in CCAI.

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Upon conversion, SMG will hold an effective interest of 21.3 per cent in CCAI, comprising a direct interest of 8.4 per cent and an indirect interest held through SIV of 12.9 per cent. Once the proposed acquisition is completed, SMG will hold an effective interest of 24.4 per cent, comprising a direct interest of 11.5 per cent and an indirect interest held through SIV of 12.9 per cent.

CCAI has two wholly-owned subsidiaries, CityClinic Vietnam and St Luke Medical Co in Vietnam, with each operating a clinic in Ho Chi Minh City.

The conversion and proposed acquisition are beneficial to SMG as it allows the group to tap the growth potential of the Vietnam market and enhance its future return on the investment, SMG said.

The proposed acquisition will be funded by the S$10 million convertible loan extended to SMG by its major shareholder, CHA Healthcare Singapore.