Bumrungrad eyes 2 more hospitals, Mongolia and Phitsanulok

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Bumrungrad Hospital (BH) is in talks to acquire a private hospital in Mongolia and one in Phitsanulok province, the deals expected to need a total budget of up to Bt5 billion.

Credit : Bumrungrad.com

Credit : Bumrungrad.com

Chai Sophonpanich, chairman of BH, said the number of Mongolian patients at its Bangkok facility was increasing, so having a presence in their own country would help serve them.

Expanding into Mongolia would strengthen revenue in the future, he added.

“We want to be the majority shareholder in the hospital in Mongolia in order to oversee the management. However, Mongolian regulations do not allow foreigners to hold a 51-per-cent stake in a private company, so we might seek local partners and jointly acquire shares of more than 51 per cent,” he said.

Chai said that if the deal were completed, the company would not change the management team because they would be familiar with their customers.

He said the cost of acquiring a 51-per-cent stake in the hospital in Mongolia would be about Bt2 billion.

Meanwhile, Chai said BH was talking with the shareholders of a private hospital in Phitsanulok, again looking to control a 51-per-cent stake. The transaction would require a budget of Bt2 billion to Bt3 billion. 

Holding more than 50 per cent will guarantee the right of management, unlike its previous investment for a 24.99-per-cent stake in Bangkok Chain Hospital, the operator of Kasemrad Hospital in Chiang Rai, from Land & Houses. BH disposed of all of its shares in BCH because of the lack of management rights at Kasemrad, he explained.

Crediot : Bumrungrad.com

Crediot : Bumrungrad.com

The company believes that expanding upcountry would increase its customer base. Moreover, the existing customers of the hospital in Phitsanulok province are in the higher-income segment, so the Bumrungrad brand will fit in well, he said. 

Chai said BH had sufficient cash to invest in both hospitals after unloading its stake in BCH, bringing in Bt3 billion to Bt4 billion. Moreover, the company has Bt5 billion in funds from a debenture issue.

BH reported net profit in the second quarter of Bt579 million, up by 16 per cent year on year. As a result, its net earnings in the first six months were Bt1.19 billion.

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