During the COVID-19 pandemic in the world and Lithuania, private healthcare institutions MediCаGroup, which consists of MediCA klinika, Kardiolita, Bendrosios medicinos praktika and Svalbono klinika, the companies active under brand name of Kardiolitos klinikos,and InMedica, which together have registered patients that account for approximately 7% of the Lithuanian population, announced plans to join forces.
“This year the coronavirus posed unexpected challenges in providing essential medical services and accelerated plans to merge private clinics. During the pandemic the need arose more than ever to create an efficient remote service system, to manage patient flows smoothly, to ensure the provision of services from the initial consultation to the third level of complex surgeries. There will also be other unforeseen challenges that will have to be solved going forward. It was therefore decided to unite the resources of the country’s family clinics and specialist forces of outpatient and inpatient clinics,” said Žaneta Girdvainytė, General Manager at MediCa Group.
The merger of Lithuanian private healthcare institutions was initiated by Repharm Group, Latvian private healthcare group, and INVL Baltic Sea Growth Fund, the largest private equity investment fund in the Baltics, whose main investor is the European Investment Fund (EIF), which distributes financing in Europe under the Juncker Plan. The transaction will take effect upon receiving permission of the Competition Council and fulfilling other transaction obligations.
Following the merger transaction, the joint healthcare facility will operate in 20 Lithuanian cities, providing services to over 200 thousand patients at all three levels – from family doctor consultations to complex heart surgeries in Kardiolitos klinikos.
“Together, we will be able to invest more in modern medical equipment. Patients will be able to choose from even more locations across the country. With a wider network of clinics, we will be able to offer our services in remote regions of Lithuania,” said Kęstutis Broniukaitis, General Manager at InMedica.
According to him, joining forces will allow offering patients new services, the provision of which is possible with a large number of potential patients. This will also allow providing much-needed long-term care services to elderly patients.
MediCа Group is managed by the Latvian private healthcare group Repharm Group, while InMedica by the largest private equity fund in the Baltic States, INVL Baltic Sea Growth Fund.
“Seeing the extremely fast-growing demand for healthcare services in the market due to the coronavirus pandemic, and the long-term potential of this sector, we decided to undertake the consolidation of medical institutions. Joining forces of InMedica and MediCа Group creates opportunities to expand the attractiveness and accessibility of services for patients and to offer attractive working conditions to the country’s medical professionals,” said Nerijus Drobavičius, Partner at INVL Baltic Sea Growth Fund.
Dins Šmits, Chairman of the Board of RePharm Group, said that attracting a strong partner in Lithuania was part of the company’s long-term development in the Baltics strategy. “Together with INVL Baltic Sea Growth Fund we will manage ambitious development and efficient operation of the joint venture. In addition, we plan to introduce healthcare solutions in Lithuania that already proved to be successful in Latvia,” said Dins Šmits.
INVL Baltic Sea Growth Fund
INVL Baltic Sea Growth Fund with its total size of €165mn is the largest private equity fund in the Baltics with the European Investment Fund (EIF) acting as its anchor investor. The EIF, which is a part of the European Investment Bank, has committed €30mn with the support of the European Fund for Strategic Investments, a key element of the Investment Plan for Europe (or the ‘Junker Plan’), as well as allocating resources from the Baltic Innovation Fund, the “fund of funds” initiative developed in cooperation with the governments of Lithuania, Latvia and Estonia. This aims to increase capital investment in high growth potential small and medium-sized enterprises in the Baltic States.
The Fund seeks to assemble a diversified portfolio of companies, targeting majority or significant minority stake deals and writing tickets of €10mn to €30mn, that showcase high growth potential and the ability to compete on a truly global basis. The Fund is focused on the Baltic States and the neighbouring regions of Poland, Scandinavia and Central Europe specifically. The Fund so far has invested in four companies within the healthcare, civil engineering and environment management (plastic recycling and waste management) sectors respectively.
The Fund is managed by one of Lithuania’s leading asset management companies INVL Asset Management, which is part of the Invalda INVL group. The group’s companies manage pension and mutual funds, alternative investments, individual portfolios, private equity assets, and other financial instruments. Over 200,000 clients in Lithuania and Latvia and international investors at the end of 2019 have entrusted the group with more than €1bn of assets under management. Active since 1991 and with a solid track record, Invalda INVL boasts 28 years worth of experience in managing private equity assets in the Baltic countries and CEE landscape while developing companies into best-in-class market leaders.
The network of medical clinics InMedica offers diagnostics, outpatient treatment, surgery, dentistry and other medical services. InMedica Group consists of 16 family medicine centres, 3 hub clinics, 1 specialized cardiology clinic, 2 walk-in clinics and 3 laboratories. A modern day-surgery centre was opened in 2019 in the Santariškės medical campus.
In 2019 InMedica Group employed more than 600 employees and provided healthcare services to over 75 thousand patients. The Group generated revenue of EUR 12.7 million in 2019. Since February 2019 70% of InMedica is owned by INVL Baltic Sea Growth Fund, the largest private equity investment fund in the Baltic States, through its company BSGF Sanus.
MediCA Group is a private medical service provider in Lithuania with the network of 33 clinics (3 specialized clinics and 30 outpatient clinics) operating in 16 cities. The Group is operating under two brands – MediCA klinika, which concentrates on the provision of primary care services, and Kardiolitos klinikos, which comprises Kardiolita UAB, Bendrosios medicinos praktika UAB and Svalbono klinika UAB and which specialises in the provision of secondary care services. The network includes Kardiolitos Klinika in Vilnius which is the only private inpatient hospital in Lithuania.
In 2019 MediCA Group employed more than 1,400 employees and provided healthcare services to over 128 thousand patients. The Group generated revenue of EUR 32.7 million in 2019. The Group is owned by Latvian private healthcare group RePharm through its Lithuanian subsidiary RP Pharma.
JSC Repharm is a group of Latvian companies operating in the field of healthcare and providing services for the whole healthcare cycle – from healthy lifestyle opportunities to diagnostics and treatment. The company includes AS “Sentor Farm aptiekas” pharmacies (brand “Mēness aptieka”), AS Veselības centru apvienība” outpatient clinics, SIA “Centrālā laboratorija” laboratory services, AS “Rīgas farmaceitiskā fabrika” health product factory and wholesales company AS “Recipe Plus”.