CareTech purchases stakes in two UAE-based businesses

Social care services provider CareTech has acquired stakes in two businesses in the United Arab Emirates for an upfront payment of £11.9m, with £5.5m in deferred cash payable.

CareTech snapped up a stake in home healthcare provider Dmetco-Bayti via its interest in UAE-based firm AS Group, purchasing 70% of the firm of the business for an upfront consideration of £7.3m in cash, with a further £3.2m in cash deferred and £1.0m in cash payable through an earn-out mechanism.

Elsewhere, CareTech acquired a 51% interest in physical health consultations and surgical services provider the Wellness Group for an upfront consideration of £8.1m in cash, with a further £3.9m in cash deferred.

Both transactions were funded by the AIM-listed group's existing cash resources and debt facility.

Chairman Farouq Sheikh said: "This is an exciting next step development in our investment in the AS Group as CareTech's platform for growth in the UAE. Dmetco-Bayti and Wellness complement the existing brands of the AS Group and together offer a pathway of specialist health and social care services to an underserved market with favourable growth prospects."

As of 0940 GMT, CareTech shares were up 0.74% at 545.0p.