MD Medical Group To Acquire Leading Healthcare Network In The Samara Region
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 twopharmacies, 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."