this is how corporate white collar launder money, get capital from public and use money to buy over valuation company and later collect the overpaid value from backdoor deal
70m price for 2 clinics for me way to much, each clinic cost 35m, one should go and study i-bella financial statement to justify this purchase
If it’s able to deliver 5mn PAT a year on financial March 2024 year end, that would translate to 14x PE only. And there is a profit guarantee so seems well structured deal. As to how lousy the share price is, it’s highly manipulated
@Super Panda & WanXKP - do a little homework before jumping to conclusions. This is not buying a provision shop. The only concern is the dilution of shares but this is mitigated by the bonus issue of free warrants. Think about it.
with dr chong aesthetic name and reputation, they can open up a new aesthetic clinic with expenditure possible just rm 1 million plus minus. they r experience in aesthetic open a new clinic is not a problem. why they want to spend p/e 20 price to buy over another people clinic, whose have same function and technique
when we do acquisition, we want synergistic effect. not like buying a company which offer exactly same service that i can already provide. with much higher and expensive price some more.
Wanxkp. Again I’m not defending them and just stating my rationale. Bella is more of the Malay crowd, so the customer segment is different and using Dr Chong name might not work or appeal to the crowd. 1mn I am guessing a bit too low, maybe 2-3mn and have to consider ramp up. In 2022, the core business by DCH is only 10mn PAT, this target can churn out 5mn per annum immediately based on profit guarantee
In its filing with Bursa Malaysia Securities Bhd, DC Healthcare said the acquisition will increase its customer's base; create and grow additional recurring income stream to enhance the group's profitability and shareholders value; benefit immediately from the increased revenue and earnings.
The I Bella group is already profitable with recorded audited net profit of RM2.93 million for the financial year ended March 31, 2023.
It also allows DC Healthcare to grow its business under a separate brand name (i.e. Bella).
DC Healthcare in a statement said, I Bella has a strong foothold among Malay customers, and is poised to significantly enrich DC Healthcare's client portfolio, especially in services like facial and skin treatments, and body and face contouring.
I Bella and its subsidiaries, namely Bella (Setia Alam) Sdn Bhd and I Bella Inspire Sdn Bhd operates two aesthetic medical clinics at Sri Petaling (Kuala Lumpur) ("Bella Clinic") and Setia Alam (Selangor). Bella group intends to open another clinic at Taman Molek (Johor), which is currently under renovation.
@lotuseater, the price movement already told you how traders react and somehow i find you are too naive in capital market, i explain why..
when company goes public, as shareholders and directors you only entitle for salary, allowance and remuneration, plus bonuses o dividend, this to be earned on montly or yearly basis
but by buying other company over its core values asset, you can deal backdoor money, lets say extra 10m out of this deal and this money will directly go to his pocket
in this world, no one would like to share his business unless that business can make him richer faster
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
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Posted by 007007 > 2023-09-13 14:54 | Report Abuse
If you can think long term then you will do well.