NMC Health acquires majority stake in Fakih IVF for $189 million

Wednesday, November 25, 2015

NMC Health, a leading integrated healthcare provider operating across the UAE, has entered into an agreement to acquire a 51 per cent shareholding in Fakih IVF Group for Dh696 million ($189 million).

NMC has also agreed a mechanism by which it could increase its stake in Fakih IVF over time, based on certain conditions being met.

Based on unaudited management accounts, Fakih IVF generated an EBITDA of $25 million for the nine months ended September 30, an increase of 20 per cent year-on-year (YoY).

Fakih IVF, which comprises of Fakih IVF and Fakih IVF Fertility Center, is the Middle East market leader for in-vitro fertilisation (IVF) services, performing over 4,000 IVF cycles per annum and offering the only full service genetics laboratory in the region.

Fakih IVF currently operates centres in both Abu Dhabi and Dubai and is looking to expand its footprint within the UAE as well as in the Gulf Cooperation Council (GCC) region.

Fakih IVF is expected to open three additional UAE centres during 2016 in Al Ain city, Western region of Abu Dhabi Emirate and Sharjah.

Fakih IVF has also achieved considerable progress in its regional expansion plan with IVF centres expected in both Qatar and Oman before year end 2016.

The transaction has been aligned with NMC’s Group strategy of establishing the company as a top in-class integrated provider of specialist care across its existing multi-brand and multi-segment healthcare verticals.  

The acquisition confirmed the NMC Maternity and Fertility vertical’s global market position, as a leading international providers of fertility treatment services based on scale of its global business and cycle capacity; focused strategic initiative towards raising capabilities and access to care in high growth and under-supplied markets; segment leading treatment capabilities and success rates; diversity and complexity of service offering across the fertility treatment spectrum; and established presence and referral centres across regulatory geographies to facilitate one-stop approach for patients.

The vertical now includes Brightpoint Royal Women’s Hospital – an advanced women’s and maternity care hospital in the Middle East; Clinica Eugin – a top global fertility care provider based in Europe; and Fakih IVF (51 per cent) – UAE based Middle Eastern leader with the only full service genetics laboratory in the region.

The combination with Fakih IVF is expected to be highly synergistic with significant potential for cross-referral of patients and transfer of best practices and technologies within NMC’s Maternity & Fertility vertical.

This transaction will also increase the company’s penetration into the Thiqa insurance segment, which is exclusively comprised of UAE nationals in Abu Dhabi, where fertility treatment is covered.

In addition, fertility treatments are one of the leading drivers of medical tourism in the UAE and the acquisition of Fakih IVF will position NMC as the destination of choice for fertility treatments with a complete service offering delivered by Fakih IVF and Clinica Eugin.

More than 50 per cent of patients treated by Fakih IVF in Dubai are expatriates with over 25 per cent being medical tourists. ABout 80 per cent of patients treated by Fakih IVF in Abu Dhabi are Emirati nationals covered by Thiqa insurance.

Dr Michael Fakih, the founder and 100 per cent beneficial owner of Fakih IVF, will remain as a 49 per cent shareholder and managing partner in the business, thereby ensuring a smooth transition and limiting any potential integration risk.

Dr B R Shetty, chief executive officer at NMC Health, said: “Our acquisition of a major shareholding in Fakih IVF is the logical next step towards achieving NMC’s goal of becoming a global leader in maternity and fertility services.

"We are particularly excited about growing our in vitro fertilisation service offering within the UAE and look forward to further expand its geographic reach.”