$18mln payday for Rural Women NZ in sale to Green Cross Health

Green Cross Health has agreed to pay around $18 million for Access Homehealth, a not-for-profit home healthcare services company owned by a grass-roots charitable organisation, Rural Women New Zealand, which will gain representation on the Green Cross board as part of the deal.

The purchase will add to earnings immediately, said Green Cross, formerly known as PharmacyBrands and the owner of the Life Pharmacy and Unichem pharmacy chains. Access has annual sales of about $85 million and employs about 4,000 people, the Auckland-based company said.

The purchase price, which includes assumed debt, will be funded from existing cash and bank funding, Green Cross said.

Buying Access would follow Green Cross's purchase of medical centre business Peak Primary and a 50 percent stake in in community nursing and health care business Total Care Health and will further establish the company as a leading provider of primary health services in New Zealand, said chairman Peter Merton.

"As a group we will be well positioned to offer comprehensive primary health services to communities throughout the country," Merton said. "Our first investment in this service area was Total Care Health Services in March 2014, and we indicated then that we intended to continue to grow through appropriate acquisitions."

"By combining services from our medical, pharmacy and community healthcare and nursing businesses we believe we have the opportunity to deliver better and more efficient primary healthcare, which will result in better patient outcomes," he said. "The silo approach to care and funding in primary care is outdated and Green Cross Health is positioning itself to provide a more integrated care approach".

Access chief executive Graeme Titcombe will continue to run the business under Green Cross ownership and a representative of Rural Women will be invited to join the Green Cross board, it said.

The purchase is conditional and Green Cross said it is satisfied a number of conditions precedent will be met over the next two weeks and the deal completed by Dec. 1.

According to Access's website, it is a not-for-profit organisation "that has been supporting New Zealanders since 1927, when the 'bush nurses' provided homecare services as part of the Women's Division Federated Farmers. WDFF has since become Rural Women New Zealand.

Shares of Green Cross last traded at $1.95, and have climbed 56 percent since the start of the year.