RHÖN-KLINIKUM AG | 05/22/2006

Growth strategy not hampered by refusal of ministerial authorisation

  • Refusal of ministerial authorisation for district hospitals in Rhön-Grabfeld does not affect strategy of RHÖN-KLINIKUM AG
  • Strong growth in revenue continues
  • Pace of privatisation quickens with German doctors on strike

The Federal Ministry of Economics on 22 May 2006 published its decision not to grant ministerial authorisation for the district hospitals in Rhön-Grabfeld. This decision does not affect the strategy of RHÖN-KLINIKUM AG – for various reasons.

RHÖN-KLINIKUM AG deliberately chose not to join the ministerial authorisation procedure initiated by the District of Rhön-Grabfeld, the reason being that such procedure represents a politically influenced decision taken on an individual-case basis. RHÖN-KLINIKUM AG, on the other hand, is interested in a decision of landmark character applying independent of individual sites. The only way to achieve this is to have the matter clarified by way of judicial ruling from the Düsseldorf Court of Appeals. This ruling is expected to come in the autumn of 2006.

On a superficial view, the outside observer might be led to draw the wrong conclusion that the German Cartel Office is hampering the Group's further expansion. In fact, though, RHÖN-KLINIKUM AG has consolidated 15 acquired hospitals since 31 December 2004. All these takeovers – including the heavyweight Universitätsklinikum Gießen und Marburg – were known to the Cartel Office and did not give rise to any objections by the latter. Although it is the market leader, RHÖN-KLINIKUM AG currently runs only 45 of the some 2,200 hospitals in Germany. This should show clearly enough just how enormous the potential is for takeovers that are unobjectionable from the standpoint of German cartel law.

The spread of doctors’ strikes to federal state institutions (university hospitals and federal state psychiatric facilities) is likely to make the Federal States a lot keener on privatisation in this area, as they will no longer be willing to foot the bill for the spreading losses. That said, the Group is not concerned by this wave of strikes because the doctors at the Gießen and Marburg sites are not striking. 

RHÖN-KLINIKUM AG is currently aligning its structures with the aim of increasing its absorption and integration capacity for new acquisitions.