Update 14 July 2020

I hope that you are all enjoying the summer even in these strange times. If you are on vacation you are probably relatively close to home, which I find has its own charms. For this update we cover:

  • Orpea and Korian continue to grow in the Dutch market  through acquisitions. Who will be next?
  • Bergman rebrands Dutch ophthalmology locations to Memira. What does this mean for their international strategy?
  • FocusCura is acquired by Assa Abloy. Is this the start of more consolidation in the Dutch personal alarm sector?
  • Tariffs for maternity care are increased substantially. Will this make the sector attractive for foreign investors?

Orpea and Korian continue to grow by acquisitions

As reported earlier both Korian and Orpea have made a number of bolt-on acquisition in the last few months. In recent weeks both have made new acquisitions. Orpea recently acquired Bloemendael. The acquisition concerns one location in Baarn (central part of the Netherlands). Bloemendael was started 25 years ago and has a total of 56 apartments. The location offers a combination of nursing home care and a care-concept based on short-term stays.

ABN Amro has recently announced that they were the financial advisor to Korian in the acquisition of Rosorum, but no official announcements have yet been made.  Rosorum is a middle-sized chain of four locations with a total of 85 apartments (with a fifth location in development). It was started in 2009 by Bart van Venrooij, who is still the managing director. Two of the current locations are traditional nursing homes, the two others are comfortable living accommodations for elderly not requiring 24/7 care.

Both companies are growing rapidly, and it does not appear that the resent health-crisis has stopped their expansion plans. The number of medium-sized commercial operators of nursing homes in the Dutch market is getting quite small, and they are busy consolidating as well. Is there further growth to be found through acquisitions, or will the focus have to move to organic growth?

Bergman rebrands to Memira

Bergman Clinics has recently rebranded its Dutch ophthalmology locations to Memira. Memira is the name of the eye-care company acquired by Bergman in Scandinavia last summer.  The Dutch non-eyecare clinics will continue to work under the Bergman Clinics brand. The rebranding appears to be a step in developing more focus in the varied activities carried out by Bergman Clinics and assist the ongoing activities related to acquisitions and finding a new investor.

FocusCura is acquired by Assa Abloy

FocusCura is a relatively large supplier of IT-based solutions for the elderly care sector with a focus on products that enable the elderly to live longer at home. Key products include personal alarms, house access systems, and medicine dispensers. In 2019 FocusCura had revenues of €13 million. FocusCura recently acquired another company offering alarm-services for the elderly.

Assa Abloy is a large Swedish-based manufacturers of entrance systems with yearly revenues of €7 billion. FocusCura will be integrated into Phoniro which offers similar services to FocusCura in Scandinavia, Germany, and the UK. The combined company will become a European leader in the market for technological solutions for elderly-care. It will be interesting to see whether the combined company does any further acquisitions in the Dutch market for alarm-services for the elderly.

Tariffs for maternity care are increased substantially

Earlier this year we wrote about the ongoing crisis in the maternity care sector due to the low tariffs paid by the insurance companies. The NZA (The Dutch Healthcare Authorities) recently announced that 2021 maximum tariffs will be increased by 6.4% from the 2020 levels. The increase is based on an analysis of the costs made in the sector and a correction for inflation. The actual payments to be made to the operators will depend on negotiations with the insurance companies and will almost always be lower than the maximum tariffs.

This appears to be a step in the right direction, but given that part of the reason for the high costs is an extreme high level of sick leave (average of 13%) it appears that the sector still has a lot of work to do.