The Monash IVF Group Ltd (ASX: MFV) share price jumped 5% yesterday on news that that company has acquired Fertility Solutions – a Queensland-based provider of fertility services.
The Monash IVF share price opened yesterday at $1.34, but shares jumped up to $1.40 after the acquisition news was released to the ASX, a bump of 4.48% for the day.
In its ASX release, Monash stated: "Monash IVF is acquiring certain assets, liabilities and contracts of Fertility Solutions for initial cash consideration of $2.1 million on a debt free basis… the acquisition (initial purchase price and subsequent earn out payments) is expected to be funded through cash flows generated by Monash IVF Group."
Fertility Solutions currently performs "in excess of 300 stimulated cycles per annum with revenues of circa $3 million." This will add to Monash IVF's $150.6 million in revenue that the company turned over in the 2018 year.
In justifying the move, Monash stated: "strategically, this acquisition expands Monash IVF's existing Queensland presence by adding two additional clinics in the Sunshine Coast and Bundaberg – regions not currently serviced by Monash IVF. These regions are appealing due to the growing population in our target demographic."
Monash IVF has struggled with low-cost competition over the past few years and the stock is still down significantly from the highs of $2.49 that it reached back in October 2016.
