BH expands in Mongolia, Phitsanulok

BH expands in Mongolia, Phitsanulok

Bumrungrad Hospital Plc (BH), the country's second-largest listed hospital operator, plans to spend up to 5 billion baht to acquire sizeable stakes in hospitals in Phitsanulok province and Mongolia.

Chairman Chai Sophonpanich said the company is conducting a feasibility study for a stake in a Mongolian facility, for which it expects to pay 2 billion baht.

An agreement is expected this year, he said, adding that BH plans to own more than 50% of this hospital for management control.

Mr Chai said Mongolian patients account for a big portion of the company's total patients, so the acquisition would add value to the company.

The deal is expected to widen the company's customer base in neighbouring China as well.

For its domestic expansion plan, BH is in talks for a 51% stake in a privately owned hospital in Phitsanulok province.

This deal, worth 2-3 billion baht, is also expected to be completed by year-end.

"It is good timing as that hospital seeks a partner and we can hold over a 50% stake, which allows us full management rights, unlike with Kasemrad Hospital. In that instance, we decided to divest the stake," he said.

Last year, BH sold its entire 24.99% stake in Bangkok Chain Hospital Plc (KH), operator of the Kasemrad Hospital chain, for 4.56 billion baht.

Mr Chai said BH has adequate funding to finance the planned acquisitions, as it obtained a hefty amount from the sale of the KH stake and a recent issue of debentures worth 5 billion baht.

BH posted on Aug 7 a reviewed second-quarter net profit of 579 million baht, up by 16% year-on-year. The first-half reviewed net profit was 1.19 billion baht, up by 10.4%.

In the second quarter, revenue rose by 10% year-on-year to 3.59 billion baht, while earnings before interest, taxes, depreciation and amortisation grew by 14.8% to 935 million.

Revenue from international patients accounted for 61.2% of the total, while Thais made up the other 38.8%, representing a small increase from 37.2% in the same period last year.

BH also announced a dividend of 70 satang a share from first-half operations.

The ex-dividend date is next Monday, to be paid on Sept 5.

Shares of BH closed Friday on the Stock Exchange of Thailand at 89.75 baht, up one baht, in trade worth 125 million baht.

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