The lobby of the newly opened Tropicana Medical Centre in Kota Damansara.
SINGAPORE: Singapore main board-listed Rowsley Ltd has announced plan to expand into the healthcare sector with the signing of a non-binding term sheet to purchase the healthcare assets of its controlling shareholder, Lim Eng Hock, worth about S$1.9bil (RM6bil).
Rowsley is a multidisciplinary real estate company with businesses in design and engineering, real estate development and hospitality.
A sale and purchase agreement is expected to be completed within two months.
The proposed acquisition is an all-share deal for a 100% of Thomson Medical Pte Ltd and a 70.36% stake in TMC Life Sciences Bhd
(TMCLS), a Bursa Malaysia-listed company.
(Editor's note: Rowsley will acquire Lim’s investment vehicle Sasteria Pte Ltd, which currently holds a 51.93% stake in TMCLS. As part of the agreement, Sasteria, prior to completion of the proposed acquisition, will also buy shares in TMCLS held by Incanto Investment Ltd and Best Blend Sdn Bhd - a further 18.43% stake.)
Thomson Medical is one of Singapore’s leading providers of healthcare services for women and children while TMCLS is a healthcare company which mainly operates through Tropicana Medical Centre, its flagship hospital.
The proposed acquisition will be financed through the issuance of new shares at S$0.075 per share.
“This proposed acquisition is an opportunity for us to acquire controlling stakes in two established healthcare assets in Singapore and Malaysia and be part of an expanding business,” said Rowsley chairman Ng Ser Miang in a statement.
“Healthcare is a big and growing market due to ageing demographics, longer lifespan, major trends to increase birth rates, and growing affluence. This deal will diversify Rowsley’s portfolio as well as strengthen our current businesses. It will also significantly increase Rowsley’s market capitalisation, market profile, and generate investor interest,” said Ng.
The proposed acquisition will also bring TMCLS’s proposed Thomson Iskandar project in Iskandar, Johor, together with Rowsley’s investment in Vantage Bay Healthcare City.
Thomson Iskandar is an integrated development that comprises a 500-bed general hospital, 400 medical suites and a retail mall.
The hospital will be equipped with state-of-the-art facilities and equipment.
“We will be able to derive synergy from combining both projects together under one company. Our enlarged company profile will further help us to attract high-quality healthcare players and investors to work with us on our Iskandar healthcare project,” said Ng.
On completion, Rowsley planned to issue bonus warrants to existing shareholders on the basis of two bonus warrants for every one existing share.
Each bonus warrant will have an exercise price of S$0.09 per share.
In addition, Rowsley planned to issue additional warrants (piggyback warrants) on the basis of one piggyback warrant for every one bonus warrant that is exercised.
Each piggyback warrant will have an exercise price of S$0.12 per share.
“We appreciate the support of our existing shareholders. The proposed issue of warrants is to reward our shareholders for their support of the firm. We will continue as a company to pursue opportunities that we believe provide long-term value to shareholders,” Ng said.
On completion of the deal, Rowsley will become a major healthcare player.
According to Singapore Exchange Market Watch statistics, healthcare is projected to be the leading sector in total returns to shareholders.
Singapore has boosted healthcare spending in recent years as its population ages.
One in four Singaporeans will be aged 65 and above by 2030, and similar demographics in Malaysia point towards an opportunity in primary healthcare and long-term healthcare.
“We are extremely excited at this opportunity to further transform Rowsley as we continue to build and grow our existing real estate-related businesses,” said Ng. - Bernama
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