Medicover expands into the healthcare market in india
On August 21, Medicover decided to initiate completion of the acquisitions of Medicover Healthcare Private Limited “Medicover Fertility India” and 22% of Sahrudaya Healthcare Private Limited “MaxCure” in India as stipulated in the prospectus. Proceeds of the two acquisitions totals approximately EUR 21 million.
Medicover Fertility India was established in 2016 and has up until now been fully funded by the principal shareholder, but managed by Medicover. The purchase price of USD 7.4 million corresponds to the original investment cost. For the full year 2016, Medicover Fertility India reported revenue of EUR 0.3 million and an EBITDA of EUR -1.7 million. For the full year 2017 and 2018, EBITDA is forecasted to EUR -3 million respectively. Thereafter revenues are expected to ramp up improving earnings contribution.
In addition to the acquisition of the Fertility business Medicover enters the hospital market in India through an initial investment in MaxCure. MaxCure owns and operates nine hospitals in the region of Andhra Pradesh and Telangana in India. Proceeds relating to the investment in MaxCure amount to EUR 13.2 million. In the agreement with the main owners of MaxCure Medicover is entitled to exercise options to further increase its ownership in two stages over the next two years.
The total maximum investment amount for securing ownership in MaxCure to more than 50% is capped at EUR 45.6 million, including the initial investment of EUR 13.2 million, and implies an EV/EBITDA multiple between 8-12x, depending on profitability development. The holding in MaxCure will be accounted for as an associated company.
“We will through these acquisitions get a very interesting footprint in the Indian Healthcare market. The private healthcare services market in India is growing about 15% per annum and we anticipate that we can through our expertise and knowledge, be an active player in this market. There is clear room for many providers in such a growing market for many years to come”, says Fredrik Rågmark, CEO Medicover.
About Medicover Fertility India
Medicover Fertility was established in January 2016, and currently runs seven clinics in Delhi, in India. The objective is to open six to nine additional clinics in Delhi and Punjab in 2017. Since launch Medicover Fertility India consultations and booking have been growing at rates close to 40% per month.
About MaxCure
MaxCure was founded in 2013, and operates today a total of nine hospitals in the region of Andhra Pradesh and Telangana with its base in Hyderabad. The majority of hospital, offer the full specialist range of care and have particular focus on Cardiology, Orthopaedics, Neurology and Gynaecology for primarily private pay patients. Revenue for full year end of March 2017 amounted to USD 47 million and EBITDA to USD 4.5million, corresponding to an EBITDA margin of 10%.
For further information, please contact:
Paula Treutiger, Director Corporate Communication & IR
Phone: +46-73 366 65 99
Mail: paula.treutiger@medicover.com
This information is information that Medicover AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 10:00 CET on August 21, 2017.
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