TORONTO, Jan. 9, 2015 /CNW/ – Quantum International Income Corp. (“QIIC” or the “Company“) (TSXV: QIC / QIC.U) is pleased to announce that its affiliate, Centers for Special Surgery (“CSS“), has signed a definitive agreement (the “Agreement”) to acquire a 90% interest in Advanced Surgery Center, LLC. (“Advanced”) by use of Nominee Agreements, whereby the individual members of CSS will become licensed by the New York StateDepartment of Health in their individual capacity. Advanced owns and operates a 5,000 square foot Class C single operating room ambulatory surgery center (“ASC”) located in Rockland County, NY on the border of Bergen, NJ andWestchester, NY, approximately 30 miles from Manhattan.
Under the terms of the Agreement, CSS will acquire a 90% interest in Advanced for US$4,000,000 payable in cash by use of Nominee Agreements, whereby individual members of CSS will become licensed by the New York StateDepartment of Health, subject to adjustment. Completion of the transaction is subject to the approval of New York State’s Public Health and Health Planning Council and the New York State Department of Health. Advanced is also applying to the New York State Department of Health to become licensed for an additional operating room, which would fit within the existing floorplan of the facility operated by Advanced. Upon receipt of that approval, an additional US$600,000 would be payable to the seller. It is anticipated that the transaction will close within 12 months, depending on the time required for New York State Department of Health’s approval.
Advanced has historically been 100% owned and operated by Dr. Michael Fiorillo. Unaudited financial statements indicate that in 2014, Advanced collected over US$1,600,000 in facility fees. The operating costs of the ASC vary but have averaged approximately US$600,000 per year over the past 3 years. Dr. Fiorillo will retain a 10% interest and has agreed to continue to perform surgeries at the ASC for a period of 7 years following closing. QIIC’s partners in CSS, NYC Surgical Associates (“NYCSA”), expect to open a medical office in the same building as the ASC and will take over responsibility for managing the center. It is anticipated that NYCSA, through CSS, will source new patient flow from this region of New York, which the Company expects will lead to an increase in the facility fees collected by the ASC.
Dr. Fiorillo, is a double board certified plastic surgeon serving the New York and New Jersey metropolitan areas. He is affiliated with several hospitals in the NY and NJ area and has numerous publications on the topic of surgery. Dr. Fiorillo’s opinion is frequently sought out by national media outlets and programs such as Fox News, Good Morning America, The Doctors and The View. Dr. Fiorillo has been in practice for over 16 years and has performed over 15,000 procedures.
Grant White, CEO of QIIC stated “We are pleased to add Advanced to our portfolio of affiliated surgery centers in the United States. This addition will broaden our patient reach and volumes and we expect it to be accretive to earnings of CSS. We are also pleased to add Dr. Fiorillo to our team of surgeon partners. His track record, experience and patient flow are expected to prove invaluable as we continue to grow our US healthcare business. We believe the business model being employed by Dr. Fiorillo to be consistent with that of CSS and highly synergistic with NYCSA.”
QIIC has a portfolio of operating and management companies and continues to seek to expand through acquisitions. QIIC currently holds a 50% interest in Centers for Special Surgery (subject to the ability of its partner to realize an enhanced share of the profits of the Company if certain performance thresholds are met), a US ambulatory surgery center company and a 67% interest in Multiple Media Entertainment, a Canadian film and television distribution company. QIIC seeks opportunities to acquire and grow businesses in order to generate stable distributions for its shareholders, as well as to achieve overall capital appreciation. The Company will seek to acquire operating businesses with a proven track record, an opportunity for growth and whose management wishes to continue to operate the business going forward. Potential acquisition targets may be private or public companies in a variety of industries, thereby allowing for diversification.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking statements and forward-looking information (collectively, “Forward-Looking Statements“) and QIIC cautions investors about important factors that could cause QIIC’s actual results to differ materially from those expressed, implied or projected in any Forward-Looking Statements included in this press release. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as “will likely result”, “are expected to”, “expects”, “will continue”, “is anticipated”, “anticipates”, “may”, “could”, “believes”, “estimates”, “intends”, “plans”, “forecast”, “projection” and “outlook”) are not historical facts and may be Forward-Looking Statements that involve projections, estimates, assumptions, known and unknown risks and uncertainties which could cause actual results or outcomes to differ materially from those expressed in such Forward-Looking Statements or otherwise materially inaccurate. No assurance can be given that these expectations or assumptions will prove to be correct and such Forward-Looking Statements included in this press release should not be unduly relied upon. These Forward-Looking Statements speak only as of management’s beliefs and expectations as of the date of this press release. In addition, this press release may contain Forward-Looking Statements drawn from or attributed to third party sources. Accordingly, any such statements are qualified in their entirety by reference to the information discussed throughout this press release.
In particular, this press release contains Forward-Looking Statements regarding anticipated future financial, structural, growth and operating performance of QIIC, including as it pertains to the acquisitions and transactions set out in this press release and the deployment of capital into new acquisitions. These Forward-Looking Statements reflect the current beliefs of management with respect to, among other things, the receipt of final Exchange acceptance for the transactions and other future events.
Actual results may differ materially due to a number of risks and uncertainties faced by QIIC, including, but not limited to: general economic and business conditions; global financial conditions; the failure of QIIC to identify acquisition targets; third parties honouring their contractual obligations with QIIC and its subsidiaries; relationships with operating and/or joint venture partners; inaccuracy, incompleteness or omissions in any of the financial and other information upon which management bases its analysis of potential acquisitions; the failure to realize the anticipated benefits of QIIC’s current and future acquisitions; factors relating to the healthcare industry, including reliance on third-party payors for revenue; licensing, certification and accreditation risk (including a delay in the receipt of the approval of the New York State Department of Health for the acquisition of the interest in the ASC); healthcare regulatory requirements; dependence on physician relationships; litigation, professional liability claims; insurance coverage limitations and uninsured risks; dependence on key personnel at the QIIC and operations level; competition from other healthcare providers; the ability of NYCSA to generate patient flow at newly acquired facilities; factors relating to the media content generation and distribution industry, including ability to deliver services in a timely manner; changes in technology, consumer markets or demand for media services; changes in federal, provincial and foreign content laws and regulations; dependence on third party content producers; competition for, among other things, capital, equipment and skilled personnel; the inability to generate sufficient cash flow from operations to meet future obligations; the inability to obtain required debt and/or equity financing for future acquisitions on suitable terms; competition for acquisition targets; seasonality and fluctuations in results; and limited diversification of QIIC’s business industries, structures and operations.
QIIC cautions that the list and description of Forward-Looking Statements, risks, assumptions and uncertainties set out above is not exhaustive. QIIC will update the Forward-Looking Statements as required be securities law. All Forward-Looking Statements contained in this press release are qualified by these cautionary statements.
Unless otherwise specified in this press release, information contained in this press release is current as of the date of this press release. Unless otherwise specified, all dollar amounts herein refer to Canadian dollars. Additional information on these and other factors that could affect the operations or financial results of QIIC and its subsidiaries are included in disclosure documents filed by QIIC with the securities regulatory authorities, available under QIIC’s profile on SEDAR at www.sedar.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Quantum International Income Corp
For further information: Grant White, Chief Executive Officer, 416.477.3410, Manu K. Sekhri, President, 416.477.3424