Fresenius buys Rhön clinics

Fresenius' hospitals unit Helios is to buy 43 hospitals and 15 outpatient centers with Rhön-Klinikum, the German healthcare company announced in a statement released Friday.

The purchase price was 3.07 billion euros ($4.07 billion) and would be entirely debt financed, according to Fresenius, which is based just outside of Frankfurt in Bad Homburg.

The acquisition was expected to add sales of about 2 billion euros and earnings before interest, tax and depreciation (Ebitda) of about 250 million euros to the Fresenius balance sheet, based on 2013 pro forma financial statements,

“A group of this size will improve cooperation of hospitals, uphold health services also in rural areas and create new services for patients,” Helios Chief Executive Francesco de Meo said in the statement.

The acquisition will make Fresenius Helios the biggest private hospital operator in Europe. Fresenius said it hoped to achieve cost synergies, which were expected to raise its earnings margin by 1 to 2 percent.

The deal came after Fresenius failed to take over Rhön-Klinikum in 2012 with a bid worth just over 3 billion euros. The attempt was foiled by rival German hospital firm Asklepios which had acquired a 5-percent stake in Rhön on the last day of the offer.

In Germany, competition among private and public hospitals is highly competitive as the country runs massive overcapacities in hospital beds and seeks to slash ballooning healthcare costs.

uhe/kms (Reuters, AFP, dpa)