Singapore-based Fullerton Health Corporation on Thursday announced the completion of its merger with Asian buyout firm RRJ Capital after settling a dispute with two of its co-founders.
The transaction involves an equity injection by RRJ Capital and a senior loan totalling S$390 million (about $283 million) to the pan-Asian health provider. It also calls for a new corporate structure, according to the announcement.
Fullerton Health said the merger received approval by 85.8% of its shareholders on May 5, 2022 and covers the combination of Fullerton Healthcare Corporation with Fullerton Health, with the latter continuing as the surviving entity.
David Sin of SIN Capital and two other co-founders, Dr Michael Tan and Dr Daniel Chan will no longer be involved with the board following the merger. The two doctors withdrew a petition filed in January to wind up the company.
Last year, Fullerton Healthcare had sought bids for a sale of the company in a process that had attracted private equity firms in a potential deal that valued it at about $1 billion before the dispute scuppered the sale process, Reuters reported.
Under the terms of the merger, RRJ, founded by the brothers Richard and Charles Ong, has subscribed for S$140 million of new ordinary shares in Fullerton Health, while the company has entered into a senior loan facility agreement for S$250 million with three banks.
RRJ’s existing perpetual securities and convertible preference shares have been cancelled and offset against S$180 million worth of new shares issued by Fullerton Health, as well as subordinated debt and cash, per the announcement.
The deal makes RRJ, which has over $15 billion of long-term capital under management, the company’s majority shareholder. The remaining stakes are held by shareholders, such as Ping An Capital, who have elected to roll over.
Fullerton Health operates in nine markets with a strong presence in Singapore, the Philippines, and Indonesia. It owns over 550 facilities and has more than 6,000 employees.
For the financial year ended December 31, 2021, Fullerton Health’s revenue crossed S$800 million, with a healthy EBITDA margin at the mid-teens and net profits.
The merger will allow the company to cut borrowings substantially, increase working capital, and have more flexibility to raise funds, Fullerton said.