Sudmédica seeks a corporate partner to build ten private hospitals in Chile and Latin America.

Sudmédica is seeking a corporate partner to build at least 10 private hospitals in Chile and Latin America over the next 10 years. The company, which is developing the private hospital of the same name in Quillota, told the CMF in an essential fact filing that the offer involves handing over up to 45% of the share ownership of the new facilities. This is stated in the document reporting on its extraordinary shareholders' meeting. At that meeting, the issuance of 3,698 new paid-in shares was approved with 100% of the votes, to be offered preferentially to current shareholders at $1,200,000 each. With these, the share capital will be divided into 38,000 shares. In a presentation attached to the essential fact filing, the company detailed that the network of 10 hospitals involves an initial investment of US$512 million: two large high-complexity facilities at US$90 million each; four medium-sized ones at US$55 million, and four basic ones at US$28 million. For a large hospital, it projected a one-time net real estate income of US$6.2 million and net clinical income of US$16 million per year. For a small one, those figures drop to US$3 million and US$4.8 million, respectively. The option to sell In addition to building hospitals to operate them, Sudmédica is considering "equipping and then selling some of the projected hospitals at the operating stage, in order to capitalize the company more quickly," according to the essential fact filing signed by general manager César Mendoza. "The initiative is a consequence of the fact that there are four private healthcare provider groups and insurers with a national presence, and some with an international presence, who have inquired about the possibility of buying the SUDMEDICA private hospital in Quillota," the executive said, identifying potential clients as isapres in Chile, IPS in Colombia, and EPS in Peru. The company backs its bet on projections from the IDB, the OECD, and the World Bank which, it cites, point to demand and real health spending in Latin America and the Caribbean growing between 3.5% and 5% annually on average until 2036, which would imply a cumulative increase of between 40% and 60%. It also states that over the last decade, private investment in the region has focused on mergers and the purchase of existing facilities rather than building new ones, and that in Chile three relevant private hospitals or clinics were built in that period. In the presentation, the company also listed the locations that interest it in the country by level of complexity: high in Antofagasta, Coquimbo, Quillota, Rancagua, Chillán, Temuco, Valdivia, and Puerto Montt; medium in Calama, Copiapó, Ovalle, Talca, Osorno, and Chiloé; and low in Vallenar, Illapel, Villa Alemana, Concón, Placilla, San Fernando, Los Ángeles, Cañete, and Angol. Abroad, its geographic interest slide includes Canada, Costa Rica, El Salvador, Guatemala, Panama, Colombia, Ecuador, Paraguay, and Peru. Each project, it specified, must be previously approved by the board. A price without a valuation study As the company specified in that document, there are currently 34,302 subscribed and paid shares, held by 738 shareholders, and the new shares would be made available to investors starting November 15. At $1,200,000 per share, the full placement would total $4,437.6 million. That is the value Mendoza recommended in the presentation, where the company took as a reference that, when it joined the Santiago Stock Exchange in 2023, more than 90% of transactions between shareholders were done at $1,130,000. "No economic valuation study was conducted based on the financial ratios that are habitually used, because the company's operations only began in October, and we do not have the 24 preceding months of operations for financial analysis," the firm acknowledged in the same text. The company also projected in the presentation a "book value" per share that would rise from US$2,368 with the first hospital to US$13,474 with all 10. These figures result from dividing the accumulated investment in hospitals by the company's 38,000 shares. According to the list of shareholders included in the presentation, the controlling shareholder is Redmédica Sudamericana Inmobiliaria SpA, with 56.02%, followed by Inversiones e Inmobiliaria Pacal SpA (2.92%) and LarrainVial Corredora de Bolsa (2.10%). According to the essential fact filing, the controlling shareholder will maintain "up to 51%" of its stake in Sudmédica, and the rest of the shares will remain free float. Quillota, underway Sudmédica's model shares real estate ownership with doctors, who buy their offices instead of renting them and can also acquire shares in the company, according to the essential fact filing. In the attached presentation, the company revealed that the Quillota hospital began serving the public in October and that it has already sold 95% of the facility's real estate business. It is worth recalling that on January 14, before the meeting that approved its expansion plan, the company explained that Chilean banks had not given it access to financing, so it had turned to investment funds and equipment leasing. That meeting then tasked the general manager with finding investors to finance US$150 million in new projects, through investment funds, credit, or a bond issuance which, if chosen, must be voted on at a new meeting.