Capitol Health Ltd. entered into a binding agreement to acquire a 90% stake in Adelaide, South Australia-based Fowler Simmons Radiology.
Fowler Simmons Radiology is a musculoskeletal imaging provider. The acquisition, which is expected to complete by the fourth quarter, will allow Melbourne-based Capitol Health to expand in Adelaide.
Capitol Health said the transaction will be funded via existing cash reserves, bank debt and an A$1.6 million scrip.
Under the agreement, Fowler Simmons Radiology's cofounder Shaun Fowler will retain 10% ownership of the company and continue as its clinical director for at least five years.
Fowler Simmons Radiology will be eligible to receive an earnout payment in the fiscal year 2021. Capitol Health also has an option to acquire the remaining 10% of the company in three years.
Capitol Health provides diagnostic imaging and related services to the healthcare market in Australia.