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Analysis IHH to take over Prince Court

Following news that Malaysian sovereign wealth fund Khazanah Nasional will acquire Prince Court Medical Centre (PCMC) from Petronas, IHH Healthcare, Asia’s largest healthcare company, has signed an agreement with Khazanah to look after the day-to-day running of the medical centre.

“This strategic acquisition marks another milestone for Khazanah in its mission to build up the healthcare services sector in Malaysia,” Khazanah said in a statement. “Khazanah will leverage all of its experience and expertise to transform PCMC into a world-class medical tourism focused hospital, and work towards turning Kuala Lumpur into a destination of choice for quality healthcare in the region,” it added.

A price will be agreed between Khazanah and Petronas by June this year and has not been publically discussed, but is estimated to be around M$1.4 billion (US$350 million).

Prince Court Medical Centre is a 270-bed private healthcare facility located in Kuala Lumpur.

In a statement to the Bursa Malaysia, IHH said that it would be given first refusal to acquire the medical centre within five years. In the meantime it will collaborate “for shared services support and operational improvement initiatives at PCMC”.

Prince Court reported a loss of M$4 million on revenues of M$211.3 million in the 2016 financial year. The medical centre has struggled with profitability since it set up and accumulated losses carried up to then were M$1.42 billion.

“We believe the addition of experienced management team would highly benefit Prince Court in better cost management and strategic treatment services offered,” said Nor Asilah Amran, analyst at Public Investment Bank.

Rumours have been swirling about an IHH involvement with Prince Court since January, though IHH has remained tight-lipped until now.

Posted on: 26/03/2018 UTC+08:00


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