SAO PAULO (Reuters) - Brazilian healthcare provider Hapvida Participacoes e Investimentos SA will look for more acquisitions in the near future after agreeing to acquire rival group Sao Francisco Saude for 5 billion reais ($1.26 billion), Chief Executive Officer Jorge Pinheiro told reporters on Tuesday.
The deal will enable Hapvida to expand to Brazil’s southeastern, southern and center-west regions, from its current focus only on the north and northeastern regions.
Pinheiro said he expects the deal to be approved by antitrust authorities due to the different geographical footprints of the companies.
Last year, Hapvida listed its shares and raised funds to finance growth.
Hapvida will pay 4.75 billion reais in cash and 250 million reais in shares. Pinheiro added the company will issue around 2 billion reais in debt to fund the deal.
Shares in Hapvida rose 7 percent to 32.75 reais on Tuesday on the Sao Paulo stock exchange.
The deal would allow Hapvida to add 1.8 million clients to its current 4 million.
Banco BTG Pactual SA and Riza Capital advised Hapvida on the deal, while Sao Francisco hired Goldman Sachs.
Reporting by Carolina Mandl; Editing by Rosalba O'Brien and Phil Berlowitz