Rhoen-Klinikum to Pursue Standalone ‘Market Leadership’

Rhoen-Klinikum AG (RHK)’s new executives said they will build a more competitive hospital network from the inside even as talks continue with major shareholders who bought stakes during Fresenius SE’s failed takeover bid.

“We want as in the past to continue to compete for market leadership,” Chief Executive Officer Martin Siebert said at a breakfast with reporters in Frankfurt today, adding that the company doesn’t need a takeover to survive. “Rhoen-Klinikum can stand alone for itself and have success and will try to do this.”

The German private hospital operator is reviewing its portfolio and thinking strategically about trends to determine where growth will come in the next five to 10 years, Chief Financial Officer Jens-Peter Neumann said at the event. In the meantime, talks are continuing with five major shareholders, Neumann said.

Siebert and Neumann were hired in November to reorient the Bad Neustadt An Der Saale, Germany-based company after Fresenius, the owner of the Helios hospital chain, failed to win enough shareholder support for the 3.1 billion-euro ($4.1 billion) bid. Asklepios Kliniken GmbH, a competitor, blocked the deal by buying a stake in Rhoen-Klinikum.

Rhoen-Klinikum’s shareholders also include Chairman Eugen Muench, Fresenius, medical-products supplier B. Braun Holding GmbH and the investors in another hospital operator, Sana Kliniken AG.

Rhoen-Klinikum rose 0.8 percent to 15.10 euros at 1:55 p.m. in Frankfurt. The stock has fallen 2 percent including reinvested dividends in the past year, giving the company a market value of 2.1 billion euros.

Missed Merger

It would be a mistake to steer the company only with the idea of “now we’ll get the missed merger,” Neumann said.

The CFO will fly to London tonight to start a series of meetings with investors. Rhoen-Klinikum wants to improve its communication with shareholders, Neumann said.

Rhoen-Klinikum isn’t concerned about having necessary investments blocked by the competitors who own a stake, Neumann said. The company doesn’t expect a wave of hospital privatizations this year, he said.

Neumann said he expects to have spoken to all the company’s major shareholders by the end of February.

Rhoen-Klinikum expects the Giessen and Marburg university hospitals to be making a profit by the end of 2014, Siebert said. The company twice cut its profit forecast last year, and earnings were hurt in part by disappointing revenue at Giessen and Marburg.

To contact the reporter on this story: Naomi Kresge in Berlin at nkresge@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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