Mainboard-listed Q&M Dental Group is buying over a dental clinic in Paragon Medical Centre at Orchard Road for $5.5 million.
It said in a Singapore Exchange filing on Tuesday that it has agreed to buy Foo & Associates from owner Dr Foo Mooh Thong.
The acquisition is in line with the group's plans to continue expanding its main dental business in Singapore, Q&M said in a statement.
It intends to have Dr Foo, an expert in computer-aided design and computer-aided milling technology, spearhead the group's expansion into this field. The group will pay Dr Foo the $5.5 million purchase price in Q&M shares and he will run the clinic for 10 years, starting this year.
Under the deal, Dr Foo will also have to provide a profit guarantee for Foo & Associates, of at least $525,000 in profits per year or $5.25 million in total for the 10-year period.
The profit guarantee amount was derived after reviewing the clinic's management track record and financial accounts, Q&M said. It added that Dr Foo's profit guarantee will benefit the company.
Apart from Dr Foo's expertise, the group also noted the clinic's prime location and its large and established patient base, including a significant amount of foreign patients who arrive in Singapore as dental tourists, it said.
The company's shares were flat at 40.5 cents as at 10.30am.