Medec makes $5m Singapore deal

PERTH-BASED health care equipment company, Medec Ltd, has inked a $5 million deal to take a controlling interest in Singapore health and wellness group, Body Contours Pty Ltd. Under the heads of agreement, Medec will acquire 51 per cent of Body Contours, with an option to increase its holding to 87.75 per cent. This is Medec’s second acquisition in Asia in the past three months, after it bought a 60 per cent stake in a Chinese manufacturing company, and comes after it announced plans to raise $1.8 million, last month to help fund future European growth. Medec will make 50 per cent on the payment amount on completion of the acquisition, expected to be July 1, and the balance will be due in 2009 and can be made at the discretion of Medec in cash or Medec shares (at a value of $0.30 per share). It has an option to acquire a further 36.75 per cent stake in Body Contours, between December 31 2007 and June 30 2009. Medec has also invited Body Contours founder, Ananda Rajah, to take up a position on the Medec board. Body Contours has been operating for 10 years and offers a range of weight management and complementary health and wellness therapies. It currently operates five centres, which includes a spa in the prestigious Raffles Town Club plus one retail outlet, and has franchising plans and agreements in place to expand into India, Malaysia and Australia. Medec believes its latest acquisition will provide synergies, as both companies have a similar target market, and existing infrastructure can be used for the roll out of Medec products and services. The Body Contours deal also gives Medec a toehold into the massive South-East Asia and India markets.