SINGAPORE - Thomson Medical Group has sold a hospitality unit to the private vehicle of property tycoon Gordon Tang for $3.38 million in cash as part of its divestment strategy to focus on its healthcare business, according to a filing with the Singapore Exchange on Friday (Sept 28) during the midday trading break.
Thomson Medical, which operates a chain of women and children's specialist clinics, said that it completed the sale of Ariva Pte Ltd to Tang Dynasty Pte Ltd, which is majority-owned by Mr Tang. Mr Tang is also the controlling shareholder of listed developer SingHaiyi Group.
Ariva was acquired in 2016 from a group of vendors, who had also made certain loans to Thomson Medical's wholly owned subsidiary Rowsley Hospitality Holdings. As part of the sale to Tang Dynasty, those vendors have also agreed to terminate all obligations that Rowsley Hospitality had to pay earn-out considerations and to repay the loans, against payment of a compromised amount.
The net asset value of Ariva was $5.26 million as at June 30.
Thomson Medical said that its current focus is to develop its healthcare business, and will assess options to divest its real estate portfolio when the opportunities arise.
"The company's business in real estate includes principally design, engineering and hospitality," Thomson Medical said.
"Ariva provides hospitality services in Asia. The company has reviewed its business and decided to streamline its real estate business in Asia to focus on being a pure-play consultancy business. The disposal is made pursuant to such decision."
Thomson Medical does not expect the deal to have any material impact on net tangible assets and earnings per share for the year ending Dec 31, 2018.
Thomson Medical shares traded at 7.7 cents, up 1.3 per cent or 0.1 cent, before the announcement.