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Hermes hired as financial advisor for Nozha acquisition

Hermes hired as financial advisor for Nozha acquisition

ArabFinance: Cleopatra Hospital Group S.A.E (CLHO) , filed this morning for regulatory approval to make a mandatory tender offer (MTO) for 100% of the outstanding shares of El Nozha International Hospital ( EL Nozha). 

Cleopatra is seeking approval from Egypt's Financial Regulatory Authority (FRA) to offer El Nozha shareholders EGP 90 per share, representing a substantial 44% premium to the share's closing price as of 16 January 2018 and valuing 100% of El Nozha c.EGP 650 million.

El Nozha is listed on the Egyptian Exchange and owns and operates profitable 110-bed hospital in the East Cairo district of Heliopolis. Acquisition of the facility, which includes a five-story building with nine operating theatres, would further cement Cleopatra's leading position in a high-profile catchment area of the nation's capital. El Nozha was founded in 1986 by leading Egyptian Physicians and has a strong track record in key specializations including surgery, intensive care, neonatal intensive care, cardiac catheterization, nephrology, endoscopy, and radiology. 

El Nozha generated a net profit of c.EGP 32 million in 2016 (9M2017: EGP 25 million) on revenues of c.EGP 144 million (9M201:125 million). 

El Nozha is exactly the type of accretive acquisition we are seeking: A physician-founded and physician-led facility with a reputation for excellence and a deep commitment to quality patient outcomes across a variety of specialties, said Cleopatra Hosptial Group Chief Executive Officer Ahmed Ezzeldin. "El Nozha benefits from strong management team and CHG is committed to fund El Nozha's substantial planned capital expenditure program for the existing facility including planned future capacity expansions and equipment upgrades to improve quality of medical services and patient access. 

Management believes that the Group is uniquely qualified and positioned to quickly add value at El Nozha. The Group sees multiple avenues to extract favorable synergies of a local nature, including doctor scheduling, tiered insurance packages, medical CAPEX, revenues and cost synergies. 

Upon successful acquisition of at least 51% of El Nozha's shares, Cleopatra intends to initiate procedures to de-list El Nozha from the EGX. Completion of the transaction is pending finalization of all regulatory approvals. 

EFG Hermes Investment Banking is advising Cleopatra Hospital Group on the transaction; Matouk Bassiouny is a legal advisor. 

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