GREENCROSS TO OPEN A CLINIC EACH MONTH
Written on the 7 October 2010
VETERINARY company Greencross Limited (GXL) plans to acquire one clinic a month after securing a $23.87 million debt funding facility for the next three years with the Commonwealth Bank (CBA).
Greencross managing director Glen Richards says the funding comes as the business moves from 12 months of consolidation to a phase of rapid expansion.
“For the last 12 months we’ve been restructuring internally, we finalised our IT platform and other gardening-type work, and from the HR side with the right people and management team we’re more than ready to acquire new clinics and integrate them,” he says.
“Our intention is that we’re capable of acquiring at least one practice a month and that’s what we’ve experienced – we acquired Caloundra and Brookvale in August, and on Thursday we will get four general practices and three emergency centres in Melbourne.
“But if we do one every three months that’s OK, and if we do one a month and we’re comfortable with that, we’ll do it.”
The company has also raised more than $3 million through a recent placement and share purchase plan, while CBA will also provide a $5 million standby facility in case of further acquisitions. The company will transfer its existing debt from National Australia Bank (NAB).
“The new funding arrangement secured with the CBA best suits the overall needs of Greencross. I am most pleased with the terms negotiated between the two parties,” says Richards.
GXL shares rose 1.47 per cent today to $0.665, but are still well below their 12-month high of $0.98.