The Medical City Poised For Renewed Growth, Welcomes CVC Capital Partners Asia V as New Investor

Pasig City, July 17, 2023—The Medical City (“TMC”), the largest health network operating under a single brand based in the Philippines, today announced the forthcoming investment from CVC Capital Partners Asia V (“CVC”), a US$4.5 billion investment fund.

CVC has a strong track record in investing in healthcare businesses in the region to support their growth strategies, including Phuong Chau International Hospital in Vietnam, HealthCare Global in India, Soho Global Health in Indonesia and Yikang Pharmacy in China.

CVC’s investment vehicles, Universal Healthcare Services Pte. Ltd. (“UHSPL”) and Kambal Health Services Pte. Ltd. (“KHSPL”), have expressed their intention to conduct a mandatory tender offer (“MTO”) to acquire up to 2,391,789 common shares, or 44.15% of the total issued and outstanding common shares, of Professional Services Inc. | The Medical City.

Together with the convertible loan extended by UHSPL to TMC, and the private share sale transactions with certain major shareholders, UHSPL and KHSPL are expected to collectively own at least a 61.71% equity stake in TMC on an as-converted basis.

The aforementioned transactions are for TMC’s Philippine business only. Separately, TMC is expected to distribute all of the equity interests held by it, directly or indirectly, in Guam Healthcare Development, Inc. (“GHDI”) to its existing shareholders.

An MTO is an offer made by an investor to buy some or all outstanding shares of a public company, as required by the Securities Regulation Code Rule 19. The MTO is a mechanism of the securities law designed to protect minority shareholders, giving them the opportunity to sell their shares at a fair price as assessed by an independent financial advisor. The Securities and Exchange Commission approved this MTO on June 20, 2023. The tender offer period begins on August 7, 2023 at 9:00 a.m. and ends on September 6, 2023 at 12:00 noon.

The entry of CVC marks a promising new chapter for TMC. In recent few years, TMC, along with the global healthcare sector, has been significantly impacted by a range of challenging factors, including the COVID-19 pandemic, delayed reimbursements from the government, and the public’s apprehension to visit the hospitals.

CVC is looking to bring in financial and operational resources to TMC, which will support TMC to be in a stronger position to overcome these challenges and accelerate its growth. The forthcoming investment from CVC allows TMC to acquire the necessary equipment and resources to expand its reach and enhance its world-class healthcare services, thereby ensuring the delivery of exceptional care to its patient partners.

“We are humbled by CVC’s trust and confidence in The Medical City. We have long been at the vanguard of advancing the future of healthcare in the Philippines and delivering services that are of greater worth to our patients,” said Dr. Eugenio Jose F. Ramos, TMC President and Group CEO. “The arrival of CVC will help us respond to evolving needs of our patients, employees, and communities, propelling us further to provide quality healthcare anytime, anywhere.”

“We are excited to contribute to the sustainable improvement of healthcare in the Philippines,” said Brian Hong, Co-Head of Southeast Asia for CVC. “We are active investors in the healthcare community across Asia and are delighted to embark on this journey with TMC, the leading integrated healthcare network in the country.”

“Despite challenges faced in the past few years, TMC has shown resilience and an unwavering commitment to its vision of becoming the leader in Philippine Healthcare,” said UHSPL and KHSPL Director and Philippine Country Head for CVC, Brice Cu. “We are confident that our support and investment into TMC will enable it to reach new heights in delivering outstanding healthcare services.”

At the completion of the MTO, it is expected that CVC together with existing major shareholders Fountel Corporation, Felicitas Antoinette, Inc. and Viva Holdings (Philippines) Pte. Ltd. and the remaining minority shareholders, consisting mainly of doctors of TMC, will continue to work together and collaborate to support the growth of TMC.

With this major milestone, TMC is all set to redefine the healthcare landscape, driving an ambitious growth strategy which is expected to provide better and more accessible health services for its patient partners.

Exchange Equity Partners Group and Fortman Cline Capital Markets acted as co-financial advisers for Professional Services Inc. in the transaction.