UAE’s NMC Health announces two acquisitions

UAE-based healthcare firm NMC has announced two acquisitions worth $207m and its first operating and management contracts in Egypt.

The company has acquired a 70 per cent stake in UAE cosmetic surgery and aesthetic medicine provider CosmeSurge and its related businesses for $170m from Emirates Healthcare Group.

The deal gives CosmeSurge an implied enterprise value of $250m and it is expected to report a 2017 EBITDA of $20.5m on $67m of revenue, according to the announcement.

NMC said the deal, which includes 18 operational clinics and a 10-bed hospital and two clinics set to open in the first half of the year, would substantially improve its cosmetic and aesthetics businesses.

It has managed CosmeSurge and related businesses since September under a previous contract and identified new revenue and cost synergies.

The cash transaction is expected to close in the first quarter.

Separately the company has acquired 80 per cent of Riyadh healthcare company Al Salam Medical Group, including the 100-bed Al Salam Medical Hospital, the Al Salam Medical Centre and the Ishbilia Medical Centre, for $37m.

NMC said it saw an opportunity to add long-term care, cosmetics and IVF services to Al Salam’s existing specialties of cardiology and paediatrics after the deal is completed.

The firm has also entered Egypt through a new operations and management contract with Emirates Healthcare Group to manage its hospitals in the country. Dar El Fouad and As Salam International have a combined capacity of 860 beds.

The contract will generate revenues of $2m in its first year of operations and will help NMC meet its previous guidance for the vertical of $19m after the CosmeSurge acquisition.

“CosmeSurge represents a continuation of building NMC’s capabilities and Al Salam further extends our geographic footprint in the KSA, cementing our leading position as a non-domiciled provider,” said NMC CEO Prasanth Manghat.

“We see substantial opportunities for revenue and cost synergies across both acquisitions, and the cosmetics business in particular has the potential to be further developed into an independent business vertical at a later stage.”

Manghat said last month the company had set aside $800m for investments in the Gulf region and other markets.

Read: UAE’s NMC Healthcare plans $800m in investments

NMC was also said to be in talks with the Saudi government to run Saad Specialist Hospital in Khobar at the end of last year.

Read: London-listed NMC in talks to run struggling Saudi hospital – sources