CFA Society Singapore
SINGAPORE (Jan 10): OUE Lippo Healthcare (OUELH) is acquiring stakes in three hospitals, one medical centre and two clinics to expand its foothold in Myanmar.
The three hospitals, with a total bed capacity of 370 beds, are located in the key cities of Yangon, Mandalay and Taunggyi. The core services offered by the hospitals include emergency, out-patient, in-patient, laboratory, imaging, physiotherapy, medical check-up, overseas clinical services, across practices including Cardiology, Orthopaedics, Obstetrics and Gynaecology.
Wholly-owned subsidiaries entered into a sale and purchase agreement with PT Waluya Graha Loka (WGL) to acquire a 40% stake in Yoma Siloam Hospital Pun Hlaing (YSHPH), and a 35% stake in Pun Hlaing International Hospital (PHIH), for a consideration of US$19.5 million ($26.5 million).
Both YSHPH and PHIH are Joint Venture companies with First Myanmar Investment Company (FMI), the conglomerate controlled by Burmese businessman Serge Pun who is also the chairman of Yoma Strategic Holdings. Upon completion of the acquisition, OUELH will be the JV partner of FMI in the management and operation of the six medical facilities operated by YSHPH.
PHIH owns and holds the leases of the land and properties on which the Facilities are located, with back-to-back leases.
Lee Yi Shyan, Chairman of OUELH, says, “Entry into Myanmar is an integral part of our strategy to grow into a Pan-Asia healthcare network. With the acquisition, we are well-positioned to provide affordable quality healthcare to meet the rising demand in one of the fastest growing emerging economies.”
OUELH will seek the approval of its shareholders for the proposed acquisition at an Extraordinary General Meeting (EGM). Japanese conglomerate Itochu Corporation, which owns 25.3% of OUELH through Browny Healthcare, has given an irrevocable undertaking to vote in favour of the proposed transaction.
Shares in OUELH last traded at 6.8 cents.