Update 1 June 2017

Welcome to the newest update on private healthcare in The Netherlands. In this newsletter we cover the following news and issues:

• In the previous update we talked about the entrance of Acibadem Healthcare Group in the Dutch market with a new general hospital. Since then yet another Turkish group has entered the Dutch market. Will other follow?
• Tandvitaal, the Dutch dentistry chain with 185 locations in The Netherlands, Germany, and Belgium is being sold. Who will use this opportunity to enter the European dentistry market?
• None of the large European elderly care operators are currently operating in The Netherlands. Is Orpea now entering the Dutch market?
• Most Dutch health care operators are non-profit foundations. How can these be acquired?
• In our Snapshot we give an overview of Bergman Clinics, an operators of private clinics.

Worldeye opens hospital in Amsterdam

The Dunyagoz Hospitals Group which outside of Turkey operates under the name Worldeye, has opened a hospital specializing in ocular health in Amsterdam. Dunyagoz Hospitals Group operates twenty branches in Turkey and has five international centers. Dunyagoz has approximately 2.500 employees.

In Amsterdam Worldeye will offer a broad range of services related to ocular health based on an initial staffing of four specialists. A wide range of the services offered are covered by the mandatory Dutch healthcare insurance. Others, such as laser eye corrections, are paid by the patients themselves. Later this year Worldeye will launch a unique prevention and screening program.

While there were privately-owned hospitals and clinics in The Netherlands, it is interesting that two Turkish groups enter the market with new offerings within two weeks of each other. Will other hospital operators (Turkish or from other countries) follow?

Tandvitaal to be sold

Tandvitaal is a chain of more than 100 dentist clinics in The Netherlands. Additionally, Tandvitaal also has clinics in Germany and Belgium. Tandvitaal has more than 1.100 employees. Tandvitaal is owned by Bencis Capital Partners, who has built up the chain through a number of acquisitions. The most recent of these was the acquisition of a rival chain in The Netherlands (Samenwerkende Tandartsen) from another private equity company (NPM). Bencis has hired Rothschild to lead the sales process and is hoping to get a price of around €400 million for the chain.

The Dutch dental care market is more than €2.5 billion per year. Dentistry is not covered by the mandatory healthcare services, and is paid for either privately or through additional healthcare insurances packages. There are approximately 6000 dentists’ offices in The Netherlands. More than 80% of these are solo-practices or part of small local groups.

An acquisition of Tandvitaal will be of interest to parties looking for a combination of local and European consolidation.

Orpea entering the Dutch market?

The word on the street is that Orpea, the large French provider of elderly care services with a presence in most European countries, has made its first acquisition in The Netherlands. As of yet there have been no official communications concerning any such acquisition. According to the rumors, the acquisition is not in the elderly care sector, but in the psychiatric care sector.

Will Orpea follow up with an acquisition in the elderly care sector?

How is it possible to acquire a Dutch non-profit foundation?

This is one of the most common questions we get from our clients. In The Netherlands, most healthcare (both cure and care) is provided by independent non-profit foundations (stichtingen). As these do not have an owner, many foreign operators interested in the Dutch market question how they can enter through the acquisition of an existing player. The short answer is that this is possible, but it is a bit complicated.

According to Dutch law, a foundation (stichting) has the following characteristics:

• It is a legal entity with limited liability created through a legal act involving a notary
• A foundation has no members, and its purpose must be stated in its articles
• The purpose of a Dutch foundation does not need to be of general interest (i.e. a good cause), but its official goal cannot include making payments to anybody except charitable causes
• Foundations can buy, own and sell all kinds of assets (including limited liability companies)
• Foundations can be terminated. Any assets remaining at termination need to be used according to the overall goals of the foundation and in line with what is stated in its articles

This means that it is not possible to acquire a Dutch non-profit foundation carrying out healthcare related activities. However, it is possible to acquire the assets and activities of such a foundation. Clearly, any such action will require the cooperation of the Board of the foundation and will potentially involve some interesting legal transactions (the foundation moving activities and assets to be sold to a limited liability company, etc.).

If you have any more questions about this area legal advice is suggested. We have excellent contacts with lawyers with a specific focus on the Dutch healthcare sector who are well placed to offer such advice.

Snapshot of Dutch private sector healthcare operator: Bergman Clinics

Bergman Clinics is the oldest and largest Dutch operator of specialized clinics. It currently operates 19 clinics located through-out The Netherlands. Bergman specializes in seven specific areas (vision, plastic surgery, skin diseases, etc.). Bergman believes that specialization enables it to build up experience and expertise, which results in innovation, (cost) efficiency, and high quality services.

Bergman Clinics has 600 employees and has revenues of approximately €75 million. Approximately two thirds of the revenue comes from services covered by the compulsory Dutch health insurance scheme. The other one third of revenues comes from medical services which are paid directly by the patient (laser eye corrections, plastic surgery, etc.). In 2013 and 2014 Bergman Clinics made losses. The losses were due to growth limitations imposed by the government and high costs related to acquisitions. In 2015 Bergman Clinics made a profit of €0.9 million.

Bergman Clinics is privately owned except for a 5% investment by RaboBank.