Even after strong consolidation movements in the healthcare industry in recent months, companies maintain the appetite for more deals. Last week, executives from Dasa, Mater Dei and Rede D’Or cited the fact during conference calls. Among the largest recent acquisitions is the purchase of SulAmérica by Rede D’Or, announced in February.

“People talk about a game of musical chairs [in the face of various consolidations]. But we are actually having tectonic plate movements. The sector is changing significantly and quickly,” said Rafael Cardoso Cordeiro, Mater Dei’s chief financial officer.

Mr. Cordeiro did not elaborate, but said that there are still major consolidation moves on the radar. “The Mater Dei network is an important piece. We have been approached and we look for players in our sector. We are important players in the changes that are happening in the sector,” he said.

The company has 2,723 beds in its portfolio, considering recent acquisitions such as Hospital Santa Genoveva and Grupo Porto Dias. Since its debut on the stock exchange, in April 2021, the group has made six purchases – of five hospitals and a data analysis and artificial intelligence company – investing about R$2 billion and increasing twofold its service capacity.

In 2021, Mater Dei reported a record net revenue of R$1 billion, up 43% year over year. Overall, the sector has been supported by the return of elective procedures and drop in spending with Covid-19.

The largest hospital group in the country, Rede D’Or is moving forward to buy SulAmérica, an insurance company that has 4.5 million users of health and dental insurance. According to the terms of the deal, which still lacks regulatory approvals, SulAmérica’s shareholders will receive 13.5% of D’Or, with a premium of 49.3% over the share price on February 18. The purchase will be subjected to a shareholders’ meeting on April 14.

Rede D’Or’s CEO Paulo Moll said that the deal with SulAmérica does not interfere in the company’s plans to continue growing via acquisition. Rede D’Or added 2,213 beds with 17 acquisitions until the first quarter of this year since its IPO. “We don’t change companies’ business models. Most of Rede D’Or’s revenue comes from operators. And in SulAmérica’s case, we obviously see a lot of growth opportunity due to how strong the brand is,” he added.

Otávio Lazcano, chief financial and investor relations officer at Rede D’Or, was optimistic about the future of the business and said that there is room for several synergies, including better use of real estate assets, which can free up cash, and transaction cost reductions between the companies. There are also fiscal and tax efficiencies that the group hopes to capture.

“[We also see] potential reduction in the debt of the expanded company. Rede D’Or has a very long cost of capital and debt term. And SulAmérica is cash positive and will contribute to EBITDA and allow us to reduce net debt,” he said.

The scenario brings strength for the company to accelerate future investments and, according to the executive, opens a window for dividend distribution. He said he was unable to provide monetary estimates for synergies for the time being. The company hopes to have a final verdict on the deal from regulators later this year.

Rede D’Or São Luiz reported profit of R$419.5 million in the fourth quarter of last year, up 38.5% year over year. Between January and December, Rede D’Or’s net income grew 265%, to R$1.67 billion. Net revenue advanced 23.2% in the quarterly comparison, totaling R$5.13 billion.

Dasa, a market leader in medical diagnosis, began its acquisition process in the hospital segment about a year and a half ago and since then has invested about R$2.5 billion in the purchase of nine hospitals. Currently, it has 15 hospital units, which together have 3,500 beds, the second place in the segment behind Rede D’Or.

Dasa’s CFO Felipe Guimarães said the company remains attentive to acquisition opportunities this year, although he argues that the focus for 2022 is to integrate the assets already acquired.

“We believe there are good opportunities to continue consolidations. It tends to be a year in which acquisitions continue, although at a lower level than in 2021,” he said.

On Friday evening, the company unveiled the purchase of Centron – Centro de Tratamento Oncológico, in Rio de Janeiro. In the fourth quarter, the company concluded the acquisition of Hospital da Bahia and São Domingos, which added 679 new beds to its portfolio.

Source: Valor International

https://valorinternational.globo.com