- Cash-and-stock deal acquires company from CVC Capital Partners
- Fresenius projects 50 million euros in savings from merger
Fresenius SE, Europe’s biggest publicly traded health-care provider, will pay $6.42 billion (5.76 billion euros) for Spain’s largest private hospital company, IDC Salud Holding S.L.U., also known as Quironsalud.
Quironsalud is 58 percent owned by the London-based private equity firm CVC Capital Partners Ltd., with the rest held by the hospital company’s management, said Matthias Link, a Fresenius spokesman. Most of the deal is being paid for in cash, financed by debt, Fresenius said in a statement Monday.
The acquisition is being made by Fresenius’s Helios unit, which is the largest hospital company in Germany but doesn’t have operations outside the country. Quironsalud manages 43 hospitals, 39 outpatient centers and 300 “occupational risk centers” across Spain, and projects revenue this year of about 2.5 billion euros.
“For Fresenius, this acquisition is another strategic step towards offering quality and yet affordable care for patients worldwide,” Fresenius Chief Executive Officer Stephan Sturm said in the statement.
Quironsalud’s CEO and founder, Víctor Madera, will join Fresenius after the transaction. While most of the deal is being paid for in cash, Madera will take payment in the form of newly issued Fresenius shares worth about 400 million euros. He won’t be able to sell the shares for two years.
The merger should result in savings of about 50 million euros a year and will be “highly accretive” to net income next year, Fresenius said. The company expects the deal to close by the end of the first quarter in 2017, and will update its guidance for next year.
Fresenius CEO Sturm took over in June, after serving as chief financial officer since 2005. The company is one of the world’s largest providers of kidney dialysis and also supplies home infusion-therapy services. It was said to be the leading bidder to buy Pfizer Inc.’s pumps and devices business, for about $1.5 billion to $2 billion, though in July people familiar with the talks said they had stalled over price.
Fresenius, based in Bad Homburg, plans to hold a conference call to discuss the deal at 2 p.m. Central European time.
Private equity firm CVC is perhaps best known as one of the owners of auto racing league Formula One. The investment firm, a former unit of Citigroup Inc., is considering selling the racing business for as much as $10 billion. Its owns a 35 percent stake.