Q&M acquires 60% stake in Chinese dental group

People wait at the reception area of Q&M dental clinic located in City Square Mall on Dec 27, 2012. M Dental Group announced on Tuesday plans to further expand its presence in China. -- ST PHOTO: DESMOND LUI
People wait at the reception area of Q&M dental clinic located in City Square Mall on Dec 27, 2012. M Dental Group announced on Tuesday plans to further expand its presence in China. -- ST PHOTO: DESMOND LUI

Mainboard-listed Q&M Dental Group announced on Tuesday plans to further expand its presence in China.

The local dental group signed a Memorandum of Understanding to acquire a 60 per cent stake in the Aoxin Stomatology Group for about $21.6 million, through its unit Q&M Dental Holdings (China).

"This is obviously a significant step in our expansion plans in China as the proposed acquisition will provide a ready-made stage and presence for Q&M Dental Group in North-Eastern China" in the Liaoning, Jilin and Heilongjiang provinces, said Q&M Dental Group chief executive Dr Ng Chin Siau.

Under the agreement, Q&M China will receive a profit guarantee from Dr Yongxin Shao, by way of dividends amounting to about $26.6 million, over a period of 12 years.

The acquisition will be funded with the firm's internal cash, existing loans from the World Bank's International Finance Corporation and the issuance of new Q&M shares to Dr Shao.

Aoxin is the largest dental group in North-Eastern China, and owns three dental hospitals, three dental clinics and a training centre in Shenyang, with net tangible assets of about $4.6 million.

Q&M Dental Group currently has two clinics in Shanghai, with investments in two dental healthcare groups in Nanjing and Beijing.