Al Noor eyes long-term care market with acquisition of Rochester Wellness

Rochester Wellness provides physical, speech and occupational rehabilitation therapy at homes and at two inpatient facilities in Dubai and Muscat.

Al Noor Hospitals has become the latest healthcare group to target the long-term care sector with the acquisition of Rochester Wellness.

The Abu Dhabi hospital operator, whose shares are listed in London, said it would buy Rochester Wellness, which provides physical, speech and occupational rehabilitation therapy at homes and at two inpatient facilities in Dubai and Muscat. The value of the deal was not disclosed.

“As a financially strong company, we have plenty of access to capital to make the acquisitions strategically important to grow our company,” said Ronald Lavater, the chief executive of Al Noor Hospitals.

He said a Rochester Wellness outlet could open in one to two years’ time in Abu Dhabi, and later in other Arabian Gulf countries.

“We want to be a full-service healthcare provider, offering a full spectrum of care,” Mr Lavater said of the acquisition. “Moreover, we do see a need in the community for long-term rehabilitation and home health services.”

Al Noor also expects to add more complex services to its facilities, such as for patients who require ventilators.

Al Noor shares yesterday rose 0.4 per cent to 825 pence. The shares were trading at 1,030 pence a year ago.

Rochester Wellness, which operates 51 beds, generated US$5.6 million of revenue during the nine months to last December.

Founded in 2006, Rochester Wellness expects to increase its service lines as well, according to its managing director, Karim Jamal.

For the first half of this year, Al Noor said revenue grew 8.5 per cent to $244m from the same period last year. It attributed that to a 13 per cent rise in outpatient numbers and a 7 per cent increase in inpatient numbers.

Al Noor runs three hospitals and 17 medical centres in the UAE, with 216 beds and 684 physicians as of June 30.

Abu Dhabi Health Services Company (Seha) provides most of the long-term healthcare services in Abu Dhabi through Tawam Hospital, Venecia Medical Center for Rehabilitation and Sheikh Khalifa Medical City. Both Seha and the Health Authority of Abu Dhabi have called for increased privatisation of the segment.

Ahmed Faiyaz, Ernst and Young’s healthcare leader for transaction advisory services in the Middle East and North Africa, said the shortfall of beds for long-term care was projected to rise to between 200 and 220 in 2025, from between 120 and 140 this year.

“We believe that the demand for long-term care will rise in the future, given that life expectancy in the [Arabian Gulf] has improved from 62 years to 77 years in the last 30 years. In the UAE, this is estimated to be 78 years for men and 80 years for women,” he said.

In June, NMC Health, a hospital operator in Abu Dhabi, acquired ProVita International Medical Center for $160.6m. ProVita has facilities in Abu Dhabi and Al Ain.

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