Stock Takes: Hamilton Radiology on the block, Healthcare Holdings said to be pitching $150m bid

A sale north of $150m would be a tasty windfall for Hamilton Radiology's specialist shareholders. Photo / 123rf

Private investment company Healthcare Holdings is understood to be in pole position to acquire Hamilton Radiology in a deal said to be worth more than $150 million.

Sources said a sales process was in full swing for the Waikato private radiology practice with six branches in Hamilton and four regional sites. The company has 140 staff and is owned by 21 radiologist shareholders.

Healthcare Holdings operates a portfolio of private healthcare businesses, including the Mercy and Ascot Hospitals in Auckland. The firm is 23 per cent owned by local private equity shop Waterman.

Healthcare Holdings managing director Andrew Wong declined to comment when asked about the possible acquisition. But the Herald understands a deal is close to being signed.

According to people close to the sale process the Hamilton business is being valued at $150m plus, meaning a tasty windfall for its doctor shareholders.

Hamilton Radiology was set up in 1923. The company provides general radiography, mammography and fluoroscopy procedures, as well as musculoskeletal, pregnancy and other ultrasounds.

A sale of the business, the fourth biggest player, would follow recent activity in the private healthcare sector.

Local infrastructure investor Infratil this month said it was expanding further into medical diagnostics with a plan to acquire a majority stake in Auckland Radiology for up to $60m, following an earlier investment in Pacific Radiology, the country's largest provider.

And last year the Herald reported Infratil had placed a A$700 million ($712m) bid for Australian radiology chain Qscan.

Infratil raised $300 million in June 2020 to pursue its growth agenda and look for investment opportunities.

The acquisition was completed in December 2020.

Qscan, owned by Quadrant Private Equity, operates around 70 clinics. Most of its operations are in NSW and Queensland, with a number in regional locations that are said to be struggling to hire skilled staff. It employs around 730, including around 100 radiologists.

While Infratil has moved into the sector, Healthcare Holdings is becoming increasingly dominant especially if the Hamilton Radiology deal comes through.

Editor's note: This article has been amended to correct the date of Infrail's acquisition of Qscan.