RSDHC Signs Conditional Contract To Form Joint Venture In China

KUALA LUMPUR, May 20 (Bernama) -- Ramsay Sime Darby Health Care (RSDHC) has signed a conditional contract to form a joint venture with Chinese healthcare company, Chengdu Jinxin Healthcare Investment Management Group Ltd (Jinxin). RSDHC is a partnership between Ramsay Health Care Ltd and Sime Darby Bhd while Jinxin is operating a number of hospitals, and is in the process of developing a new hospital in the city of Chengdu, China. RSDHC will have an effective 50 per cent stake in the joint venture and is expected to be the first international hospital operator to invest across a broad spectrum of specialty facilities in the Chinese hospital market, RSDHC said. "The joint venture will initially involve four of the hospitals that Jinxin currently operates in Chengdu and, at a later stage, a 500 bed women's health private hospital due to open later this year. "In total, it is contemplated that the joint venture will involve these five hospitals with approximately 2,300 beds and a focus on women’s health, mental health, and traditional Chinese medicine," it said in a statement. Sime Darby President and Group Chief Executive Mohd Bakke Salleh said the partnership with Jinxin was a good start for Ramsay Sime Darby as it sought to build a portfolio of quality hospitals across Asia. "Both partners - Ramsay and Sime Darby - have been keen to expand our hospital portfolio in Asia and this new deal with Jinxin, a reputable hospital operator, provides Ramsay Sime Darby with a foothold in a very attractive market and allows it to accelerate our growth plans in the region," he said. The total cash consideration for Ramsay Sime Darby’s equity share of the joint venture will be approximately US$135 million (RM431 million) and will be funded through Ramsay Sime Darby's existing debt facility. The total consideration will be paid by Ramsay Sime Darby to Jinxin in two phases. The first phase of the transaction relates to the four hospitals that Jinxin currently operates while the second phase of the transaction relates to the new women's health private hospital, which is currently being developed. Given that the deal is subject to the parties satisfying all conditions precedent, a timeframe for final completion of each phase of the transaction has not yet been established but it is envisaged that both phases will be completed before the end of financial year 2016. --BERNAMA