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Shanghai Fosun Pharmaceutical to buy Shenzhen hospital
Posted on Tuesday, 14 November 2017 01:55
Shanghai Fosun Hospital Investment, a holding unit of Shanghai Fosun Pharmaceutical (SFP), is acquiring 60.0 per cent of Shenzhen Hengsheng Hospital (SHH) for CNY 909.00 million (USD 136.90 million).

The two sellers are Shenzhen Yinxun Investment Consulting Enterprise and Shenzhen Fengcheng Investment Advisory Enterprise, both of which will retain the remaining 40.0 per cent stake in the target.

SFP is mainly a drug maker which provides therapeutic treatment products for six major areas : cardiovascular system, metabolism and alimentary system, central nervous system, blood system, anti-infection and anti-tumour.

Listed on the Hong Kong and Shanghai stock exchanges, the group manufactures medical equipment and operates medical centres as secondary businesses, which collectively account for almost a third of its revenue.

It currently owns private hospitals and clinics in Beijing, Shanghai, Tianjin and Qingdao, among other Chinese locations, under the brand name United Family.

SFP posted revenue of CNY 8.28 billion in the six months ended 30th June 2017, up 20.3 per cent on the CNY 6.88 billion recorded during the same timeframe of the previous year.

Profit before tax for the period totalled CNY 2.18 billion, compared to CNY 1.93 billion in H1 2016.

Founded in 2004, SHH is billed as one of the largest tertiary private general hospitals in Shenzhen.

The transaction comes as the buyer wants to capitalise on the target’s expertise to expand in areas such as paediatrics and assisted reproduction services.

Following the acquisition, the target will form part of SFP’s vast medical services network in the Pearl River Delta region as it seeks to grow its healthcare business in developed coastal cities and regions in China.

According to Zephyr, the M&A database published by Bureau van Dijk, there have been 57 announced deals targeting Chinese hospital operators announced since the beginning of this year.

© Zephus Ltd