Livingstone Health Holdings Unveils Strategic Acquisition of Wellington Pte. Ltd.

Key Details of the Transaction and Its Potential Share Price Impact

Livingstone Health Holdings Limited (the “Company”) has announced a significant development that could influence its growth trajectory and market valuation: its subsidiary, Phoenix Medical Group Pte. Ltd. (“PMG”), has entered into a Share Sale and Purchase Agreement (SPA) to acquire the entire issued and paid-up share capital of Wellington Pte. Ltd. (the “Target”).

1. Transaction Overview

• The acquisition will result in PMG becoming the legal and beneficial owner of all issued shares in Wellington Pte. Ltd., turning it into an indirect subsidiary of Livingstone Health Holdings.
• The Proposed Acquisition is classified as a “disclosable transaction” under the Catalist Rules of the Singapore Exchange due to the relative size of the deal.

2. Information on the Target and Vendors

• Wellington Pte. Ltd. was incorporated in Singapore in 2009 and is the sole proprietor of London (MH) Clinic & Surgery—a general practice clinic located at 104 Hougang Avenue 1.
• As at the announcement date, Wellington Pte. Ltd. has an issued and paid-up capital of S\$1,000, comprising 1,000 ordinary shares.
• The Vendors, Dr Ng Wei Seng and Ms Tang Sau Kuay @ Tang Li Wah, collectively own 100% of the Target (Dr Ng holds 999 shares, Ms Tang holds 1 share) and are both directors of the Target.
• The Target’s latest unaudited financials (as of 31 December 2025) show an adjusted net tangible asset (NTA) of S\$130,000 and adjusted net profit before tax for 2025 of S\$484,000 (after management adjustments).
• No valuation was conducted on the Target for this deal.

3. Rationale Behind the Acquisition

• The acquisition is a strategic move to enhance Livingstone Health’s Primary Healthcare segment, expand its network of medical professionals, and grow its service offerings for patients.
• The Board believes this acquisition aligns with Livingstone’s long-term growth and value creation strategies.

4. Principal Terms of the SPA

• Consideration: The total purchase price is S\$1,330,000, to be paid in cash, with payment milestones and deferred components based on operational and licensing outcomes:
  • S\$679,000 payable upon completion.
  • S\$20,000 reimbursement for minimum cash in bank accounts.
  • S\$81,000 in respect of trade receivables from government programs, paid after actual receipt.
  • S\$200,000 each payable after meeting net profit after tax (NPAT) targets of at least S\$300,000 for operating years 2027 and 2028, with adjustments as defined in the SPA.
  • S\$150,000 upon receipt of a new clinic licence within 30 months of completion.
• The consideration was determined based on arm’s length negotiations, considering the Target’s financials, integration potential, and payment structure.
• Conditions Precedent: The deal is subject to satisfactory due diligence, execution of new employment and tenancy agreements with Dr Ng, board and regulatory approvals, no material adverse changes, and other standard SPA conditions.
• If conditions are not met within 60 days, PMG may terminate or waive certain conditions.
• Completion Date: Expected on 1 March 2026, unless extended by mutual agreement.

5. Source of Funds

• The acquisition will be financed through a mix of internal resources and bank borrowings.

6. Key Financial Metrics and Share Price Sensitivity

• Relative Figures: The Target’s profit before tax for the period 1 April to 30 September 2025 is S\$439,000, compared to the group’s profit of S\$126,000 for the same period (348.6% of group profit).
• The consideration (S\$1.33 million) is 7.3% of Livingstone’s market capitalisation (S\$18.3 million), crossing the 5% threshold for a disclosable transaction but well below the 75% threshold for a major transaction.
• No new equity will be issued as consideration; this is a cash transaction.
• The transaction is expected to be earnings-accretive: Pro forma figures suggest the Group’s EPS for the year ended 31 March 2025 could rise from 0.10 to 0.17 Singapore cents, and net profit from S\$557,000 to S\$1,005,000—an uplift of nearly 80%.
• However, NTA per share is projected to decrease from 0.37 to 0.17 Singapore cents, reflecting goodwill recognition of about S\$1.2 million.
• The transaction does not require shareholder approval, but is price-sensitive due to its material impact on financial performance.

7. Other Important Notes for Shareholders

• The SPA contains several conditions that must be satisfied for completion, and there is no guarantee the transaction will proceed. Shareholders are advised to monitor further announcements.
• No directors or controlling shareholders of Livingstone Health Holdings have any direct or indirect interest in the acquisition, other than through their own shareholdings.
• No new directors will be appointed, and no service contracts are proposed in connection with this acquisition.
• Shareholders may inspect the SPA at Livingstone Health’s registered office for three months from the announcement date.

8. Conclusion: Potential Share Price Impact

This acquisition is a potentially price-sensitive event for Livingstone Health Holdings. The deal could materially boost the Group’s earnings per share and net profit, supporting its long-term growth strategy in primary healthcare. However, the drop in NTA per share and the recognition of significant goodwill should also be considered. Shareholders should pay close attention to future updates regarding satisfaction of SPA conditions and completion of the transaction.

Disclaimer

This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell shares in Livingstone Health Holdings Limited. Investors should conduct their own research and consult professional advisers before making any investment decisions. The proposed acquisition is subject to various conditions and may not be completed as described.

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