Listed private health provider Wakefield Hospital has agreed to buy Wellington's Bowen Hospital for $5 million.
The purchase, which includes the hospital and its site in the Wellington suburb of Crofton Downs, is conditional on Wakefield gaining regulatory and shareholder approval.
Wakefield chairman John Calder said this process could take another 10-12weeks.
The company would fund the purchase with a combination of vendor financing and a bank loan.
Bowen Hospital has three surgical theatres and 45 beds, and its location and facilities complemented Wakefield's existing operations well, Mr Calder said.
"Together, the two hospitals offer a range of facilities and skills without equal in the Wellington region, and at least equal to the best available privately anywhere else in New Zealand. There are also good opportunities for expansion of the existing activities.
"In combination, Bowen and Wakefield will be a considerably bigger force in the private hospital sector than either could have been on their own."
Bowen's major specialities include plastic and reconstructive surgery; general surgery; dental, oral and maxillofacial surgery; ear, nose and throat surgery; gynaecological surgery; orthopaedic surgery; and a gastroenterology unit. Bowen also has a sleep disorders unit that operates in conjunction with the Otago University Wellington School of Medicine.
Shares in Wakefield closed yesterday up a cent at $1.27, against a year high of $1.60 and a low of $1.15.
The company last month recorded a 60 per cent drop in its net after-tax profit to $683,000 on revenue of $22.5 million in the year ending March 31.
The unaudited result was substantially lower than forecast, and was hurt by the previously announced loss of lucrative cardiac surgery contracts.
The previous year Wakefield reported a $1.7 million profit on revenue of $24.7 million.
