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YOUR CARE CONSULT AND ATO KUBIK ADVISE GROUP MOHRING/ VITAL WOHNEN ON THE SALE OF THE COMPANY TO THE GERMAN NURSING HOME OPERATOR ALLOHEIM 

Paris/ Berlin, 03.02.2020 – Ato Kubik and Your Care Consult advised Group Mohring/ Vital Wohnen for the sale of the company.

The sale was successfully completed in December 2019 with the acquisition of 16 Nursing Homes (partially already up and running and partially recently opened or to be built), 3 of which includes their real Estate. All premises are located in North Rhein Westfalia. 

Operations have been bought by Alloheim, while the Real Estate has been bought by Three Stone Capital.

The sale will be completed after the approval of the relevant Antitrust committees.

Both Mohring/ Vital Wohnen and Alloheim operate nursing homes, assisted living, domiciliary care and day care.

The Mohring Group, established in 1996 by the Mohring family, further developed with Vital Wohnen (a JV with Investors from Hamburg).

Alloheim was founded in 1973 by Alois Mollik and is a major German player.

With this acquisition Alloheim considerably reinforces his footprint in North Rhein Westfalia and will reach a total of 24.000 beds under operation in Germany.

Threestones Capital  is an  independent European investment management group managing private equity and real estate regulated investment vehicles with a Total of EUR 1,6 B AUM specialised in Healthcare investments for more than 10 years.

A few headlines on the transaction:

• 324 existing Nursing Home beds, with extra assisted living beds, domiciliary care and 3 day care centers from the Mohringside
• 461 Nursing Home bedsfrom the Vital Wohnen side, recently opened
• 391 Nursing Home bedsfrom the Vital Wohnen side, still to be built 2 of which will open in 2020.

for a Total of 1.176 of Nursing Homes beds (with a 97% Single Room quota) 264 Assisted Living Beds, 126 Day Care places, 64 Flat Sharing places as well as domiciliary care.

Jesko Beckendorf, Sebastian Gutsch, Andrea Minciarelli and Stéphane Pichon successfully assisted Mohring/ Vital Wohnen as Lead Advisors.

Aderhold Rechtsanwaltsgesellschaft mbH, Dortmund and ARQIS Rechtsanwälte, Duesseldorf were the legal advisors of, respectively, the Seller and the Buyer

Recent activity in Spanish psychiatry and mental health suggests growth on this market is picking up speed. Who are the emerging consolidators? We speak to market experts following this space.

Private equity began making inroads into the sector in 2016 when Iberian investor Magnum Partners bought a 75% stake in eating and behavioural disorder specialists ITA. The company, which saw revenues of €13.4m and net profits of €1.7m in 2017, bought Previ group last year, a business with four centres in Valencia, and a psychiatric clinic in Godella. This year, under new CEO Jaume Raventós Monjo, the company has already acquired a new centre in the Barcelona region and expanded to Chile, joining competitors Grupo 5 and DomusVi.

Grupo 5, backed by Corpfin Capital since 2017, operates in a segment called ‘psychosocial rehabilitation’ and is mostly contracted by regional authorities to deliver community-based care with a mix of home care, outpatient and inpatient facilities. Last month the company acquired a neurological treatment centre in Navarra, and it announced aggressive plans to expand across the country last year.

The big fish here – DomusVi – had been focusing its expansion in its reference market of nursing homes, but this year it created the brand Mentalia Salud under which all eight of its psychiatric and mental health facilities will operate. The group acquired a facility in the Canaries with 74 beds last month – bumping DomusVi’s total mental health offering to 1,000 beds, run by a team of 550 employees.

“The private sector is playing catch up here,” says Stéphane Pichon of Your Care Consult. “We think there will be new entrants onto this market from European groups other than the French – possibly from Germany or the Netherlands.”

Even Orpea joined the bid for a position, with its acquisition of 82-bed facility Clinica Lopez-Ibor (€5m) in 2017. But a leading consolidator has yet to emerge.

“The private offer is really fragmented,” says David Alberti of Your Care Consult. “There is margin to consolidate, but with small deals. Historically, the sector has been dominated by religious orders who remain the most active players,” he adds.

“The biggest is Hermanas Hospitalarias holding 43% market share with 6,000 beds. Though non-profits are currently investing capex into current facilities and also developing homecare and daycare, it is possible private players could buy out non-profit facilities.

“One of DomusVi’s strategies with nursing homes is to buy from the Church,” adds Pichon. “So it’s something they could replicate in mental health.”

Our Analysis: The Spanish mental health sector is seeing momentum pick up as private equity and large French groups roll out their growth strategies. For now, opportunities for investment abide in small private settings, but with such a large portion of beds owned by non-profits and the public sector, it remains to be seen how the private sector will consolidate its share. Will a single consolidator emerge? Perhaps a player that can crack the delivery of integrated services – which, according to ITA’s CEO Raventós Monjo, is the private sector’s next challenge – will set themselves apart.

We would welcome your thoughts on this story. Email your views to Anaïs Charles or call 0207 183 3779.

https://hbi2019.healthcarebusinessinternational.com

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The global hospital group Ramsay reported 12.7% growth in net-profit after tax this week with margins increasing in France despite tariff cuts.

Ramsay Santé, the product of Ramsay France’s merger with General de Santé, grew EBITDAR by 0.5% to €448m in the year to June 30, 2017, with sales following narrowly behind with 0.3% growth.

That gives Ramsay an improved EBITDAR margin in France despite another year of cuts to the tariff offered to private hospitals by the French government, which helped to take 1.5% off rival Capio’s EBITDA margin in July.

Stéphane Pichon, managing partner at French consultancy Your Care Consult, put their contrasting results down to a difference in the case mix between the groups and an increased focus on emergency procedures by Ramsay.

“Ramsay did well in mental health and rehab and less well in acute care. It has also begun opening emergency departments, with around half a million visits in the last year, which helps politically when you go asking for higher tariffs. Capio, on the other hand, is much more of a focused acute care hospital business.”

Ramsay is also cleaning out its portfolio by selling off two hospitals, one to Vivalto Santé, and finalising the integration of the HPM group in Lille, said Pichon.

In its domestic market, the Australian group managed to avoid the fate of competitor Healthscope, which reported a 40% fall in NPAT earlier in August causing its share price to plummet. Ramsay grew sales 7% and EBIT 13.6% in the market, which remains its powerhouse despite global diversification. Investors were not impressed, however, and shares fell from 71 AUD to below 67 AUD.

Ramsay’s new boss Craig McNally said: “In international markets, we are looking forward to the increase in tariff in the UK scheduled for April 2018 and in France, the election of the new government has seen an uplift in business and consumer sentiment, which bodes well for the future in that country.

Pichon agreed that the business environment is improving for private healthcare in France. Concrete change to policy have yet to emerge from the new Macron government but Pichon says a tariff convergence between the health and care sides of the senior care business is on the cards, and that this would please the private operators.

“The public sector is arguing against though the government has argued that once you total both sides the tariff will remain unchanged,” said Pichon.

Looking forward, McNally said Ramsay will continue to look for more opportunities in out of hospital and outpatient care. He said: “There is also increasing potential for out-of-hospital growth opportunities in adjacent businesses like retail pharmacy, across all markets in which we operate. We will continue to seek opportunities to broaden our care beyond hospitals to deliver integrated care across an increasingly disperse ecosystem.”

Source: Healthcare Business International, 1 September 2017