Oct. 9–Bumrungrad Hospital plans to clear its retained losses of more than two billion baht by early next year by using funds generated from its cash flow and a recent private placement, and throughaccounting measures.
Of the total net losses of 2.28 billion baht, funds to eliminate 1.28 billion baht will come from a combination of cash flow and one billion baht raised in a private placement last week. The remaining one billion baht will likely be cleared from a writedown of the share par value in the next two months, company executives said.
Last week, Bumrungrad Hospital placed 42.86 million shares priced at 25 baht each. The shares were the result of the conversion of 750 million baht in convertible debentures that the company had issued to Bangkok Bank following its debt restructuring in 2000.
As a result of the offering, Bumrungrad’s paid-up capital increased to 1.3 billion baht from around 900 million.
The placement also diluted Bangkok Bank’s stake in Bumrungrad Hospital to 33.6 percent from 49.6 percent. Another big shareholder in the company is Bangkok Insurance with a 15 percent stake, while the remaining shares are held by small investors.
More than 90 percent of the placement went to institutional investors, including leading domestic funds and institutions as well as regional emerging market and hedge funds.
Geographically, 70 percent of the investors were domestic and 30 percent were foreign, according Phumchai Kambhato, executive vice-president and head of investment banking of Bualuang Securities which acted as Bumrungrad’s lead underwriter.
As the result of the private placement, Bumrungrad Hospital now meets the requirements to have its listing on the Stock Exchange of Thailand transferred from the Rehabco sector to the Healthcare sector.
Shares of the company are currently suspended after last trading at 4.7 baht. Trading is expected to resume on Oct 30.
Revenue from foreign patients, which today accounts for almost 40 percent of total patient revenue, has been growing at a compounded annual growth rate of 40 percent since 1998, said Bumrungrad’s chief executive, Curtis Schroeder.
The 554-bed hospital to date has treated 850,000 patients, of whom 280,000 were foreigners from 110 countries.
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