Riyadh – Mubasher: Middle East Healthcare Co (MEAHCO), known as the Saudi German Hospital (SGH), on Sunday said its board approved signing several management supervision agreements with Bait Al Batterjee Medical Company, the majority shareholder in MEAHCO.

The deals involve six hospitals, the healthcare company said in a filing to the Saudi Stock Exchange (Tadawul).

The hospitals include two in the UAE; one in Sharjah and another in Ajman. The deal also includes four hospitals under development in Pakistan, of which three are owned by Bait Al Batterjee Medical Co. and its affiliates. Those will be built at Bahria Townships in Lahore, Islamabad, and Karachi, with the final one being owned by Bahria Town in Lahore.

“When completed, [the hospitals] will be operated under the Saudi German Hospital brand name,” the company said in its statement.

The agreements will be valid for a ten-year period from the date of signing the agreement, which was Thursday, 2 March 2017.

SGH noted that MEAHCO had no shareholding in any of the abovementioned hospitals and that the agreement for the Sharjah and Ajman hospitals had the same terms as other SGH Hospitals outside Saudi Arabia. They see a management fee of 10% of net profits before taxes, the filing showed.

“For Pakistan hospital projects, the management supervision agreement of four hospitals are packaged together, for the three hospitals owned by Bait Al Batterjee Medical Co. in Lahore, Karachi, and Islamabad, Middle East Healthcare Co. shall be entitled for management fee of 10% of net profit before taxes and that relating to the Bahria Orchid Hospital in Lahore is with no cost to MEAHCO and no management fee is receivable,” it said.

Operations for the hospital in Sharjah, a daycare centre under development, are expected to commence in the second quarter of 2018, while revenues are expected to begin from 2020.

Meanwhile, the Ajman Healthcare for Development Co. FZC is a 150-bed hospital, also under development, and is expected to commence operations in Q3-19, with revenue to begin starting 2021.

Finally, the “Bahria Town Hospital in Lahore is nearing completion and the hospitals owned by Bait Al Batterjee Medical Co in Pakistan are under planning stage,” the company added.

The financial impact of these hospitals will be announced at a later time, SGH concluded.

Earlier on Sunday, SGH announced signing an SAR 100 million loan with the National Commercial Bank (NCB).

The company’s stock ended Sunday’s trades in the green, rising 0.36% to SAR 70.