Susan Smith, Staff Reporter
MICHAEL LEE CHIN
MICHAEL LEE Chin's fund management company, AIC, is spending $65 million for a 67 per cent stake in Kingston's privately-owned Medical Associates Hospital and has invited the Delhi-based hospital consulting and health care group, Apollo Hospitals, to chart a strategy for the development of the acquisition.
Medical Associates was controlled by a group of doctors, but like most private hospitals in Jamaica had fallen on hard times, losing money, racking up huge debts and was in need of capital to modernise and even stay alive.
Yesterday, Simone Khouri, the CEO of Medical Associates, confirmed that an agreement was signed at the end of May for Lee Chin's take-over of the hospital and that due diligence was being completed for the acquisition.
"Arrangements are now being finalised for AIC to initially take up 67 per cent of Medical Associates," said Khouri, a former investment banker, who took over as CEO three years ago and has spent the time attempting to restructure the balance sheet and find investors.
"He (Lee Chin) is putting up $65 million," she said.
Medical Associates' financial statements were not immediately available, but among the things that Khouri and her board had
to accomplish was the clearing of $350 million in debt, including penalty and interest, owed to the Government for statutory deductions.
Most of that was completed earlier this year with the Government and its agencies deciding to waive some of the penalties, the hospital agreeing to pay some cash and the putting in place of arrangements to clear the rest, thus substantially clearing the way for a fresh investor.
Now Lee Chin's group wants to transform Medical Associates into a model of a modern, high-quality hospital, apparently as a stepping stone for similar ventures elsewhere in the Caribbean, as part of a strategy for health tourism. He expects Apollo, which runs private hospitals, pharmacies and other health care facilities in India and Asia, to provide the blueprint.
BEST CLINICAL SERVICES
Medical Associates Hospital.
"We are bringing Apollo to get direction for the best clinical services and nursing plans," said Joe Sserrazza, an AIC executive who is in charge of the Medical Associates project. "We want to develop centres of excellence which model Apollo."
Added Sserrazza: "We will start by bringing people (medical tourists) from Miami and Canada."
The prospects for health tourism apart, the acquisition of Medical Associates appears, analysts say, to be a good fit for another of Lee Chin's planned acquisitions, the health care insurer, Blue Cross of Jamaica. Lee Chin's National Commercial Bank has been awaiting regulatory approval for the deal which would give it about 30 per cent of the company.
Blue Cross Jamaica says it is the island's largest group health provider, with a gross premium income of $1.9 billion in 2005.
"With Blue Cross and Medical Associates in the same stable, they could leverage each other to gain maximum benefit of both," said one analyst. "If you can get good quality and decently affordable care in Jamaica, you will use it. If the same company that provides the health care provides the insurance, the better for it."
Said Sserrazza: "We are hoping to see the health care in Jamaica improving drastically. There is no reason for Jamaicans to go to Miami for treatment."
