Krungdhon Hospital Surges to Record on Buyout: Bangkok Mover

Krungdhon Hospital Pcl (KDH), Thailand’s second-smallest publicly traded hospital operator, surged to a record in Bangkok trading after its largest shareholder announced a buyout plan.

Krungdhon jumped 13 percent to 63.50 baht as of the 12:30 p.m. local-time trading break, heading for the highest close since it started trading in January 1990. The stock earlier rallied by the 30 percent daily limit and was the biggest gainer in the 497-member SET Index (SET), which advanced 0.4 percent.

Bangkok Dusit Medical Services Pcl (BGH), the country’s biggest private-hospital operator, will offer to buy the remaining shares in Krungdhon after agreeing to boost its stake to 45 percent from 20 percent, the companies said in separate regulatory filings today. Krungdhon will benefit from Bangkok Dusit’s larger shareholding through upgraded facilities, according to Bualuang Securities Pcl.

“The acquisition price is not expensive,” Narumon Ekasamut, a Bualuang analyst, wrote in a report today. “The key benefit is geographical diversification.”

Bangkok Dusit agreed to buy 3.74 million shares, or a 25 percent stake, of Krungdhon at 55 baht each from existing major shareholders, it said in its statement to the stock exchange. The company will make the tender offer to other shareholders at the same price, according to the statement.

Bangkok Dusit’s offer price for Krungdhon, while 1.8 percent lower than yesterday’s close, was 20 percent higher than the average closing level in the past three months, according to data compiled by Bloomberg. Krungdhon, which has a market value of 953 million baht ($32 million), is the second smallest hospital stock in the 14-member SET Health Care Service Index. (SETHELTH)

Bangkok Dusit will benefit from a broadening of its customer base within its hospital business, it said. Bangkok Dusit fell 0.4 percent to 128.50 baht in Bangkok.

To contact the reporter on this story: Anuchit Nguyen in Bangkok at anguyen@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

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