Totally to acquire Pioneer Health Care in a deal worth up to £13m
(TLY ) has entered into an agreement to acquire a specialist NHS secondary care service provider, Pioneer Health Care, for a total consideration of up to £13.0 million.
Totally, which provides healthcare services, corporate fitness and wellbeing services across the UK and Ireland, said the agreement, which is on a cash-free and debt-free basis, will be paid 80% in cash, with the remaining 20% to be satisfied by the issue of new ordinary shares.
The sum of £6.9m is payable on completion while up to £6.1m is payable on a deferred basis, based on Pioneer’s financial performance in the year to 31 March 2022. The deal is expected to be completed on or around 10 March 2022, which is the date of admission, Totally noted.
Pioneer Healthcare delivers insourcing and outsourcing services across a wide range of surgical and medical specialities to NHS patients and holds contracts with NHS Foundation Trusts and Clinical Commissioning Groups, predominantly across the North of England.
It holds Any Qualified Provider (“AQP”) status, which enables it to offer services directly to NHS patients across England, free at the point of delivery, where there is sufficient demand.
Pioneer is led by three senior NHS consultants, Mr Hesham Zaki, Professor Prasad Godbole and Mr John McMullan, who are well recognised in their chosen fields, and will continue to hold senior leadership roles within the business following the acquisition, Totally detailed.
Under the terms of the proposed acquisition, Pioneer Healthcare and Totally Healthcare, which forms Totally’s Insourcing division, will be brought together to create a single, established, provider of insourcing and outsourcing services under the Pioneer brand.
Together, this new division will use its combined range of services to new and existing NHS foundation trusts, hospitals and CCGs across the UK and Ireland, the company explained.
The acquisition, which is the Company’s second in three months, supports the Board’s buy and build strategy, utilising the substantial cash balances held by Totally to strengthen its service proposition and bring further earnings-enhancing opportunities, it told investors.
Totally believes Pioneer provides an additional platform for future profitable growth; it also noted that the NHS is set to receive the bulk of a new £36m health and social care funding package over the next three years, with the intention of addressing the growing backlog and waiting list position.
Based on unaudited management accounts for the year to 31 March 2021, Pioneer generated revenue of £5.13m and pre-tax profit of £0.80m. Gross assets by this date stood at £2.82m.
Commenting on the proposed acquisition, Wendy Lawrence, CEO of Totally, said: “This is Totally’s second acquisition in three months, demonstrating our commitment to growing the business, delivering enhanced shareholder value through our ‘buy and build’ strategy and moving into areas where we know demand for services is outstripping current capacity.”
She said the acquisition creates new opportunities for the Group and will ensure Totally can continue to give “vital support to the NHS as it recovers from the COVID-19 pandemic.”
“The combined insourcing and outsourcing business will benefit from its stronger footprint across the UK and Ireland and the additional significant experience of the Pioneer leadership team. Pioneer has an excellent reputation in the market and we look forward to delivering on the undeniable potential that is available to the combined business,” added Lawrence.
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