ComfortDelGro is buying National Patient Transport (NPT), a provider of non-emergency patient transportation services in Victoria, New South Wales and Western Australia, for A$30 million (S$30.2 million).
The purchase, which is subject to regulatory approval, is priced at 4.6 times NPT's earnings before interest, tax, depreciation and amortisation. The consideration will be paid from internal resources.
ComfortDelGro currently runs public scheduled bus services in New South Wales and Victoria, and taxi services in Western Australia. NPT will give the group an adjacent business in land transport services, ComfortDelGro said.
NPT owns a fleet of 144 vehicles that provide a range of healthcare transport services to major metropolitan hospital networks, including walker, hoist and stretcher transport services, and specialist services for high acuity and complex patients.
It also operates a registered training organisation and is qualified to deliver and assess a range of non-emergency healthcare transport, first aid and resuscitation courses in Australia.
"This is an exciting opportunity for us to expand into an adjacent area of land transport services. It enables us to leverage on our core capabilities in contract, fleet and manpower management while broadening our breadth of skills," ComfortDelGro chief executive and managing director Yang Ban Seng said in a statement.
"The non-emergency patient transport business is experiencing strong growth and one that shows great potential with ageing populations in much of the developed world."
Analysts noted that ComfortDelGro has been an active acquirer over the past few years, with a number of small-ticket deals.
The NPT investment is "very small and I don't expect it to move the needle", UOB Kay Hian head of research Andrew Chow said.
"But it tells me that they are quite cashed up and they are looking to do these smallish but accretive developments."
DBS Group Research analyst Andy Sim said NPT was an interesting foray into the healthcare space for ComfortDelGro, whose traditional businesses are in taxis, buses and trains.
"But the broad theme is still mature markets," he added.
The analysts were split, however, on how much ComfortDelGro's appetite for new deals is affected by the pending acquisition of a majority stake in Singapore private-hire rental business Lion City Rentals - an investment that hangs in the balance amid a potential merger between Lion City owner Uber and its rival Grab.
ComfortDelGro shares yesterday closed unchanged at $2.08.