PETALING JAYA: Qualitas Medical Ltd is said to be on track for its initial public offering (IPO) on the Singapore stock exchange (SGX), with its valuation still being sorted out by the promoters.
Sources said investment bankers hired by the company, which operates a chain of medical clinics, are currently working towards fixing a price that would be agreeable to its prospective investors as well as the existing shareholders.
“Following Qualitas’ book-building exercise, it now has several potential price options for the IPO exercise based on the demand from investors.
“The company’s listing on the SGX is still on. It is just a matter of pricing,” said a banker.
According to a newswire report last week, the company was originally scheduled to price the offering on April 11, following the book-building process from April 2 to April 6.
However, the ongoing talks with its anchor investors was said to be a key reason for Qualitas’ delay in finalising the share sale price.
Speculation has been rife that Qualitas’ listing plans, which is likely to raise nearly RM400mil, may be derailed due to tepid response from investors. However, the banker has dispelled such concerns.
Reuters had reported earlier that Qualitas was planning for a listing in January or February this year.
The source pointed out that Qualitas’s IPO exercise has received good response from institutional investors.
“After the share sale price has been fixed, the institutional investors will be able to finalise their interest in acquiring a stake in the primary healthcare provider,” he added.
Based on the deal’s terms obtained by Bloomberg, Qualitas was offering as many as 175.4 million shares at 57 Singapore cents (RM1.69) to 76 Singapore cents (RM2.26) each.
This basically means that the company could potentially raise about S$100mil (RM297mil) to S$133.3mil (RM396mil) from the IPO.
However, it has also been reported that Qualitas may likely price its IPO towards the low end of its price guidance of 57 Singapore cents.
Qualitas, founded and helmed by managing director Datuk Dr Noorul Ameen, owns and operates primary healthcare centres across Malaysia, Australia, Singapore and India.
It owns and operates 136 primary care centres, 25 dental clinics, one dental hospital, one dental laboratory, and 12 medical imaging centres (of which one is a wellness and diagnostic centre), and it has affiliate or associate relationships with an additional 104 GP clinics in Malaysia.
It is no surprise that Qualitas is seeking a listing in Singapore, as healthcare companies tend to garner higher valuations. Also, the company has access to tap into a wider pool of funds.
Qualitas is seeking a listing to expand its business to include ambulatory-care centres, which would carry out same-day procedures to reduce the cost of healthcare. Under its proposed disruptive model, patients need not be admitted into hospitals.
The successful listing of Qualitas on the SGX main board will mark the company’s return to the city-state’s stock exchange, after it was taken private nearly seven years ago.
The healthcare provider was listed on Singapore’s Catalist exchange for small companies in 2008 until its delisting in 2011.
Qualitas was taken private by Southern Capital Group Ltd for US$36mil (RM116mil).
Southern Capital, a private equity firm that is controlled by the family of Tan Sri Tan Teong Hean, has an 85% stake in Qualitas. Tan was the former major shareholder and chief executive of Southern Bank until it was taken over by CIMB Group in 2006.
Prior to its plan for an SGX listing, Qualitas had eyed floating its shares on Bursa Malaysia in 2015. However, the plan failed to take off.
In a StarBiz report back in 2015, Noorul Ameen attributed the aborted IPO exercise to the unfavourable market conditions then.
He had said that the financial advisers felt the market was quite soft then and that they should consider postponing it to a later time.