Synergy Assessment in relation to a potential acquisition of a regional healthcare group

Situation

Our client was exploring a potential acquisition of a regional healthcare group with operations across South East Asia

In order to help them assess the potential future value of the investment, we were engaged to undertake a synergy assessment for the acquisition

The synergy analysis focused on the potential revenue and cost synergies (benchmarked against industry players) arising from the potential acquisition

Approach

• Developed synergy assessment model to estimate the potential revenue uplift from increased patient referrals across the broader healthcare group
• Identified and quantified cost savings from a) vendor consolidation; and b) rationalisation of headcount post-acquisition
• Benchmarked potential combined entity against best-in-class healthcare service providers to estimate cost optimisation potential for the combined hospitals in the network

Impact

• Estimated the financial impact of synergies anticipated from integrating hospital operations across both groups. The outcome of which was an illustrative value bridge highlighting the revenue and cost synergy potential from the potential acquisition
• Identified key enablers, risks and mitigating factors in relation to achieving the proposed synergies

Illustrative value creation bridge

FTE rationalization