KUALA LUMPUR (Nov 21): DC Healthcare Holdings Bhd has proposed to acquire aesthetic medical clinic operator I Bella Sdn Bhd for RM70 million in cash and new shares at 58 sen apiece.

The company is proposing to pay RM35 million cash for the acquisition, while the other RM35 million will be satisfied via a total of 60.34 million new shares, representing 5.71% of its enlarged share capital post-exercise.

Concurrently, DC Healthcare has proposed a one-for-four bonus issue of warrants with a five-year tenure and exercise price to be determined later. The shares consideration for I Bella’s acquisition is not entitled to the free warrants, DC Healthcare said.

DC Healthcare said it intends to use RM15 million of its remaining initial public offering proceeds of RM36.74 million to partly fund the cash portion of the acquisition. The company’s listing in July saw it raise RM49.82 million at 25 sen per share.

The group is buying the 100% stake in I Bella from vendors Then Yen Tsing and Arrow Peak Sdn Bhd.

I Bella, which has two clinics in Sri Petaling and Setia Alam, is renovating a clinic in Taman Molek, Johor to be opened in the future. Its net assets stood at RM4.34 million.

In the financial year ended March 31, 2023 (FY2023), I Bella's profit after tax (PAT) grew 132.96% year-on-year to RM2.93 million from RM1.26 million, as revenue rose 32.39% to RM11.85 million, from RM8.95 million.

DC Healthcare said the purchase consideration is arrived at based on the independent relative valuation approach of RM58.1 million to RM77 million, and PAT guarantee of RM11.4 million in FY2024 and FY2025.

Shareholders of DC Healthcare will be entitled to vote on the proposals in an extraordinary general meeting to be held later.

Shares of DC Healthcare have climbed 25% since its listing, and stood at 51 sen at the time of writing, for a market capitalisation of RM508.11 million.