KUALA LUMPUR (Oct 8): Hong Seng Consolidated Bhd is acquiring a 51% stake in health technologies provider Pow Pocket Sdn Bhd for RM200 million to expand its healthcare businesses.

Hong Seng said in a bourse filing on Friday that its unit HS Bio Sdn Bhd (formerly known as HS Bio Supplies Sdn Bhd) has entered into a heads of agreement with Pow Pocket's major shareholder Russell Walter Boyd for the acquisition.

Pow Pocket is a Malaysian company with its principal business in investment holdings for financial services and health technologies-related business activities. It is currently operating Jengu, which is a web-based digital health engine dedicated to Covid-19 screening, vaccination, and digital health.

According to Hong Seng, HS Bio and its subsidiaries have expanded its healthcare business from providing third party and fourth party logistics services to entire end-to-end healthcare supply chain, and this deal encompasses the front-facing and back-end processes, logistics, digital healthcare platform, medical laboratory facilities, research and development services as well as the provision of medical and healthcare supplies for both private and public sectors.

"The proposed acquisition is part of the continuous initiatives of HS Bio to drive its healthcare business forward to enable HS Bio to be the main digital healthcare platform to help the government and nation to revolutionise private healthcare in Malaysia through the combined capabilities, resources, network and channels of both HS Bio Group and Pow Pocket," it said.

In addition, it said the proposed acquisition will provide an opportunity for HS Bio to have a controlling stake of 51% in Pow Pocket to gain control over Pow Pocket's management and operations to strengthen the synergies among the businesses of HS Bio Group as well as to enable the group to reap the benefits of future revenues and profits to be derived from Pow Pocket's businesses on its digital healthcare platform, among others, its ImmuPlan in the state of Johor as well as the nationwide roll-out of Immunise for booster and juvenile shots in the country.

The board is also of the view that the proposed acquisition will allow HS Bio to further deepen its capabilities in the HealthChain to enhance its healthcare service delivery via leveraging technology, including digitalising healthcare services and improving research, development and innovation capacities alongside the integration of Pow Pocket's health screening platform and its vaccine management systems with eMedAsia's digital healthcare platform which has a network of more than 2,200 private clinics.

"As such, the board believes that the proposed acquisition will in turn contribute positively to the group's future earnings via its healthcare segment and improve the group's financial position," it said.

At 2.32pm, Hong Seng Consolidated fell 30 sen or 8.62% to RM3.18, valuing the group at RM7.91 billion.

The counter has risen 102.55% since Sept 24, when it was last traded at RM1.57.