14 Mar 2013 07:14
MD MEDICAL GROUP TO ACQUIRE LEADING HEALTHCARE NETWORKIN THE SAMARA REGION
14 March 2013 - MD Medical Group Investments Plc ("MD Medical Group", "MDMG" or the "Company" - LSE: MDMG), Russia's leading provider of private women's and children's healthcare, announces the proposed acquisition from unrelated third parties of 100% of Vitanostra Ltd, operator of the IDK Medical Company network of women's and children's health clinics in the Russian region of Samara.
Established in 1992 and recognised as the largest independent healthcare provider in the Samara region, IDK specialises in obstetrics (maternity), gynaecology, fertility treatment, paediatrics and clinical diagnostics.
IDK's network includes two medical centres, a children's polyclinic, a clinical diagnostics centre, two outpatient clinics in Tolyatti (Samara region's second largest city) and Novokuybyshevsk and two pharmacies, giving the group one of the strongest franchises in the region. In 2012, IDK handled around 150,000 outpatient treatments and 953 IVF cycles. The total revenue of IDK, as calculated in accordance with unaudited management accounts for 2012, was RUB 513 mln.
The acquisition is for a cash consideration of USD 16.1 mln for 100% of the outstanding share capital of Vitanostra Ltd, a parent company, which owns 100% of IDK Medical. The transaction is expected to be completed in the first half of 2013 after regulatory approvals.
Commenting on the acquisition, Chairman of MD Medical Group, Dr Mark Kurtser said:
"The proposed acquisition of the IDK Medical Company network is fully in line with our strategy to expand into the regions of Russia through selective acquisition of the best performing local medical groups. It will allow us to take a leading position in the rapidly developing private healthcare services market of one of Russia's sizeable and fast growing regions."
Chief Executive Officer of MD Medical Group, Dr Elena Mladova added:
"With its specialisation in women's and children's health and its focus on quality and clinical excellence, IDK is an ideal fit with our Mother and Child portfolio. It has the potential to provide considerable synergies with our existing operations and we intend to invest an additional USD 3 mln in the modernization and further development of IDK. Upon completion of the acquisition, IDK will be fully integrated into MD Medical Group. We are also very pleased that the management of IDK will remain with the business for at least three years. They were instrumental in growing IDK and we welcome them to the team at MDMG."
ENDS
For more information about the proposed transaction please refer to the management presentation on the Company's web site at http://www.mcclinics.com/investors/presentations/
For further information please contact:
Investors Maxim Novikov Head of Investor Relations MD Medical Group Investments Plc Tel: +7 495 331 16 50 ir@mospmc.ru
Media M:Communications |
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Tom Blackwell / Anna Yarmarkova - Moscow Tel: +7 495 363 2842 | |
Sarah Macleod / Mary-Jane Elliott - LondonTel: +44 20 7920 2300 |
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mdmg@mcomgroup.com
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About MD Medical Group
MD Medical Group operates in the highly attractive Russian private healthcare service market and has a leading position in high-quality women's health and paediatrics. The company manages ten modern healthcare facilities, including two hospitals and eight outpatient clinics in Moscow, St. Petersburg, Ufa and Perm. In addition, two franchised outpatient clinics operate in Kyiv and one franchised outpatient clinic in Irkutsk.
The Company's main medical facilities are the Perinatal Medical Center (PMC), a 250-bed medical centre, which opened its doors in 2006, and Lapino hospital, a 182-bed medical centre, which opened at the end of 2012. In 2012, there were 3,253 deliveries in PMC and Lapino. The number of outpatient treatments for 2012 in PMC and the Company's outpatient clinics totalled 422,622. In March 2013, the Company began construction of its third hospital in Ufa.
As of June 30, 2012, the Company employed 1,461 medical specialists and staff. The Company's shares have been listed on the London Stock Exchange (LSE ticker "MDMG") in the form of Global Depositary Receipts (GDRs) since 12 October 2012.
About the Samara Region
Situated approximately 1,000 km to the south east of Moscow and covering an area of 53,600 sq km, the Samara region is one of Russia's most economically developed with gross regional product of approximately USD 23 billion in 2011. The population of 3.2 million is based around its major cities including Samara (1.1 million) and Tolyatti (0.7 million). The birth rate is 11.5 per thousand, resulting in 37,000 deliveries per annum.
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Forward-Looking Statements:
This press release contains forward looking statements, which are based on the Company's current expectations and assumptions and may involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The forward looking statements contained in this press release are based on past trends or activities and should not be taken that such trends or activities will continue in the future. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a number of variables which could cause actual results or trends to differ materially, including, but not limited to: conditions in the market, market position of the Company, earnings, financial position, cash flows, return on capital and operating margins, anticipated investments and economic conditions; the Company's ability to obtain capital/additional finance; a reduction in demand by customers; an increase in competition; an unexpected decline in revenue or profitability; legislative, fiscal and regulatory developments, including, but not limited to, changes in environmental and health and safety regulations; exchange rate fluctuations; retention of senior management; the maintenance of labour relations; fluctuations in the cost of input costs; and operating and financial restrictions as a result of financing arrangements.
No statement in this press release is intended to constitute a profit forecast, nor should any statements be interpreted to mean that earnings or earnings per share will necessarily be greater or lesser than those for the relevant preceding financial periods for the Company. Each forward looking statement relates only as of the date of the particular statement.