OUE Limited and its healthcare subsidiary, OUE Lippo Healthcare (OUELH) have announced that their joint venture, Echo Healthcare Management has formed a partnership with three medical specialist groups in Singapore.
OUELH and OUE hold 60% and 40% respectively in Echo Healthcare Management, and under the partnership, Echo and the respective founders of the medical partners will hold a 60:40 shareholding ratio in holding company Echo Healthcare Services respectively.
The holding company will in turn own 60% of each of the medical partners, with a total of 11 specialist doctors operating in 10 clinics.
The three specialist groups are RMA Global (RMA), The Respiratory Practice (Farrer) (TRPF), and Breathing Heart (BH) respectively.
RMA currently owns and operates three clinics in Gleneagles Medical Centre, Mount Elizabeth Novena Specialist Centre and Mount Elizabeth Medical Centre, and are specialist clinics for the diagnosis and treatment of lung, sleep and allergy disorders.
TRPF currently owns and operates six clinics, and similar to RMA's medical clinics, are specialist clinics for lung (including sleep and allergy) and intensive care medicine.
BH meanwhile, operates a clinic specialising in thoracic and cardiovascular surgery.
All doctors currently engaged by the clinics will remain engaged after the partnership completes.
OUE and OUE Lippo Health will spend just over $31 million to buy over their 60% stake in the specialist groups.
Executive Chairman and Group CEO of OUE, Dr Stephen Riady said, “We believe that the integration of the Medical Partners into the OUELH healthcare network will bring us one step closer to realising our vision in becoming a leading healthcare group in the region.”
OUELH Chairman Lee Yi Shyan added, “By allowing our medical partners to retain their clinical independence, we are able to align stakeholders’ objectives and long-term business sustainability. I believe we have created a model for synergy and growth.”
OUE and OUELH say that based on the medical partners’ financial results for the past three financial years, they are earnings accretive with a stable and growing stream of recurring income and cash flow.
Shares of OUE closed at $1.31 on May 23, down 0.76%, while OUELH closed at 3.8 cents, up 5.56%.
OUELH JV = Echo Healthcare Management
HoldCo = Echo Healthcare Services