Tibbiyah completes the acquisition of majority stake in innovative care company

Arabian International Healthcare Holding Company (“TIBBIYAH” or the “Company”) listed on the Saudi Exchange Nomu Market under Symbol TIBBIYAH/9530 and ISIN: SA15H194KT19, a leading integrated healthcare solutions provider in Saudi Arabia, has completed the acquisition of a 51% stake in Innovative Care Company for up to SAR 213.5 million (please refer to the earn-out scheme described below).
Established in Riyadh in 2016 by Professor Aayed Alqahtani, an international leader in bariatric surgeries, the New You Medical Center operates in a single building comprising of eight specialized medical units employing world-class doctors and elite health care providers. Having built a solid reputation and a loyal customer base, New You is the preferred destination for patients seeking treatment in areas including obesity, plastic surgery, Cosmetic Gynecology, dentistry, dermatology and more. New You and its elite team provided state of the art medical services to their clients and perform to date more than 500,000 procedures Since launching operations in 2016, New You has enjoyed a steady revenue growth and profit margins supported by a growing patients base

Commenting on the acquisition, Engineer Alaa Ahmad Ameen, CEO of TIBBIYAH, said: “The acquisition is in line with our strategy to diversify TIBBIYAH’s portfolio by adding exposure to the specialized private healthcare services sector, including through transactions in growth companies adding sustainable annuity-type revenues and high margin to our portfolio of activities. The specialized clinical services market offers exciting potential in the Kingdom and we look forward to our partnership with Professor Aayed Alqahtani’s and his team to unlock New You’s full potential and further expand the business in other parts of the Kingdom.”
Professor Aayed Alqahtani, CEO and owner of New You, said: “TIBBIYAH” established by Al Faisaliah Group, as a healthcare industry expertise, combined with their financial and technical support, make them the ideal partner to shoulder our long-term growth ambitions by replicating our successful model in the Kingdom.”
This value accretive transaction will see TIBBIYAH acquire a controlling 51% stake in Innovative Care Company, which owns New You Medical Center and iPharma, through a cash payment of SAR 109.5 million with the balance of up to SAR 104 million linked to an earn-out structure over three years.
The transaction has sought all regulatory approvals and satisfied all condition precedents.
The acquisition offers a compelling value creation proposition for Tibbiyah and its shareholders: New You’s current operations generate steady annual revenues in excess of SAR 120 million with EBITDA margins well above 30%. New You has a strong balance sheet with high cash generation and no debt allowing for further expansion in new business lines as well as geographical locations in the Kingdom. It also supports customer base diversification, steady cash inflow generation from private patients and adds high margin operations to Tibbiyah’s portfolio.
The acquisition will be fully consolidated into TIBBIYAH’s financials with the impact set to flow through from Q3 FY22..