Capitol Health Limited has acquired a network of four clinics from Uniradiology for an aggregate acquisition consideration of A$8.1 million (more than USD $5.8 million) upfront in cash.

The move extends the reach of the Australia-based imaging provider into the Melbourne suburb of Carlton, as well as expanding its existing presence in Frankston, Boronia and Dandenong.

“This acquisition represents a consolidation and expansion of our existing Victorian network,” Andrew Harrison, managing director of Capitol, said in a statement. “The businesses are highly complementary to Capitol, sharing many of the same referrers, and are largely bulk-billed in nature.”
Equipped to provide services in CT, MR, ultrasound, OPG and mammography, the clinics are expected to boost revenues in smaller existing locations, contributing $6.3 million in total to the network.

In addition, the new locations are projected to incur $1.16 million EBITDA on an annual basis, based on a forecast for the fiscal 2019 year.

The extension into Carlton offers Capitol strategic advantages by placing its reach within the proximity of major public and private hospitals in Melbourne.

“The acquisition is another step forward for Capitol’s disciplined growth agenda,” said Harrison. “We continue to see a number of outstanding opportunities for acquisitive and organic growth.”

The deals for each clinic will be carried out using existing cash reserves and debt facilities. The aggregate acquisition consideration is debt-free and includes the assumption of transferring employee entitlements.

The full transaction for all is expected to close in the third quarter of the fiscal 2019 year, will be subject to standard conditions, and will contribute to the full year fiscal results.

Key resources will join Capitol upon completion of the transaction.

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