UPDATE: Centrul Medical Unirea will merge with Euroclinic

Insurer Eureko reached an agreement to sell Euroclinic Hospital and Euroclinic Medical Centers in Romania to local medical services provider, Centrul Medical Unirea (CMU).

The transaction, which was announced in a press conference on Monday, is expected to be finalized by the end of the year and is pending approval from the competent authorities.

When asked by journalists about the value of the transaction, Wargha Enayati, general manager of CMU, said the two parties agreed not to disclose this information and only mentioned that the sum is somewhere between EUR 1 million and EUR 50 million.

Euroclinic will keep its name because it is a very well-known name on the market, he said.

“For Eureko, health insurances remain an essential part in the growth strategy in Romania. Eureko clients will benefit, via this partnership, of a more extended network of suppliers of medical services, by adding the CMU network to the already existent one of 250 suppliers,” said Frans Van der Ent, country manager of Eureko.

He also said that he had been continuously contacted by all kinds of investors showing interest in Euroclinic and decided to sell because for Euroclinic it was better to look for a new shareholder and become part of a bigger group where it can develop.

“This sale did not take place because Eureko was in financial crisis. We evaluated the future of Euroclinic and determined that in its current shape it really needs aggressive investments to grow or it needs a partner, so we did not take only the money matters into consideration when we made the sale,” said Van der Ent.

Eureko Asigurari has approximately 8,000 insured clients. These clients will have access to the medical facilities of the new group: a team of 1,000 doctors in the three hospitals and over 23 policlinics. There are in total 26 private medical institutions in Bucharest and the rest of the country that have a capacity of 150 beds, 10 rooms for surgery, labor and birth, and over 60 specialties.

Euroclinic runs a hospital and three medical centers, and it has 350 employees. Last year was a profitable year for Euroclinic which entered on profit and posted a revenue of about EUR 8 million in 2009.

In 2008, Euroclinic Hospital had losses of approximately EUR 1.5 million, while Euroclinic Medical Centers has losses of approximately EUR 87,000, as shown in data from the Finance Ministry.

CMU has a local network consisting of 18 clinics, an imaging center and in-patient facilities for surgery and maternity.

Other insurers do not have for the moment access to the CMU and Euroclinic network.

“This year, the two companies will have a cumulated turnover of EUR 30 million. We have proposed to double the consolidated business of CMU and Euroclinic in the next years,” said Enayati.

Investment Fund Advent International took over 80 percent of the CMU shares, and the value of the transaction surpassed EUR 40 million. The rest of the share stock belongs to cardiologist Wargha Enayati, founder of CMU network.

Otilia Haraga

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