HIP, Chemconsult unloaded
November 1, 2010
THE listed parent company of the
Health Information Pharmacy
franchise group has announced
plans to sell its “non-core and loss
making businesses” to the firm’s
founder, Ken Lee.
The move follows a review
commissioned earlier this year by a
group of new shareholders who
invested earlier this year, and will
see Lee acquire various assets
including a subsidiary named
Health Information Pharmacy
Franchising Pty Ltd, currently
valued in the accounts as worth
minus $929,000.
Also to be offloaded is the
Chemconsult Australia offshoot,
valued at $7248, a company called
HIP IP Pty Ltd worth minus
$17,000, another firm called
Leverage Finance Pty Ltd valued at
about $7000, plus Health
Corporation’s 50% holding in Asset
Trust 1 Unit Trust, valued at $3.6m.
Lee will pay a nominal $4m for
the assets - but no cash will actually
change hands, with the purchase
funded through the forgiveness of
various debts owed by the company
to Lee and associated companies.
Currently the K&J Lee Partnership
is owed $2.4m, and the deal also
includes Lee agreeing to assume
debts owing by the businesses he is
acquiring as part of the move.
Health Corporation said the move
will “provide greater opportunities
for both organinc and acquisitive
expansion by retiring debt and
removing loss-making investments,
thereby improving the Company’s
foundation for growth of future
earnings”.
If shareholders approve the
transaction, Health Corporation’s
remaining assets will comprise two
companies called HIP MBA Pty Ltd,
which provides accounting services
to pharmacy businesses, and HEA
Management Pty Ltd, which
provides management services to
pharmacies.
The company will also ask
shareholders to approve the
previously announced all-share
purchase of Intramedics Pty Ltd,
which is an Australian company
developing a “biologically stable
form of Hyaluronic Acid”.
An independent expert’s report
into the sale of the Health
Information Pharmacy and
Chemconsult operations to Lee
concluded that the transaction was
“fair and reasonable”.
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