Medical centres sold
Healius sells to private equity for $500m
HEALIUS is selling its chain of medical centres to Melbournebased private equity group BGH Capital for $500 million.
Included in the transaction are 69 large-scale medical centres, 13 Health & Co practices and 62 dental clinics across Australia, mostly under their own brands.
Healius managing director and chief executive Malcolm
Parmenter said the sale was a “seminal moment in the history of Healius”, which was founded in 1985.
Healius will be left with its pathology, Adora fertility clinics, imaging and day hospital business. The company’s pathology collection centres and imaging clinics in the sold-off medical centres would be retained under long-term leases.
“The sale is consistent with our strategy of simplifying our portfolio and focusing on our leading and scalable diagnostic and day hospital business,” Dr Parmenter said.
Healius said the price tag was about 13 times the medical centres’ 2019 earnings of $37.5 million.
Dr Parmenter said the medical centres had been sold
“at an attractive valuation to us, despite the challenging environment from the COVID-19 pandemic, testament to the quality of this business”.
The value of the medical centres division had not been reflected in the company’s share price, he said.
The proceeds will be used to reduce net debt, reducing its
Healius managing director and CEO Malcolm Parmenter on the firm’s sale of medical centres gearing from 2.7 times to 1.5, and to free up capital for investment.
Healius said it was confident it would be able to keep its bank gearing ratio below 3x.
While the company’s pathology laboratories have been processing more than 2000 COVID-19 tests a day, overall revenue has been down substantially during the pandemic although they have been moving back towards pre-COVID levels with the lifting of clinical restrictions.
Healius Primary Care will have the right to use the Healius name for 12 months.
BGH founding partner Robin Bishop said the firm recognised “the critical role Healius Primary Care plays in frontline care in Australia and we are excited about the opportunity to invest in and expand its existing services”.