SINGAPORE (Jan 2): Pacific Healthcare Holdings has entered into a sale and purchase agreement to dispose its 100% stake in Pacific Cancer Centre to Royal Medical & Imaging for $5 million.

“The proposed disposal is a good opportunity for the company to dispose of an underperforming asset for valuable consideration and is part of the company's continuous effort to strengthen its balance sheet. The proceeds would provide an injection of working capital for ongoing operational expenses,” said Pacific Healthcare in a regulatory filing.

Pacific Healthcare said the proposed disposal will give rise to a gain on disposal of $3.8 million which allows the company to dispose of an under-performing asset and strengthen its balance sheet.

Upon completion of the proposed disposal, Pacific Healthcare will cease to have any shareholding interest in Pacific Cancer Centre.

“Pacific Cancer Centre is loss-making and affects the profits of the Group as a result. The Proposed Disposal will mean that the Group will have a stronger balance sheet and profit and loss statement going forward,” the company said in the regulatory filing.

Pacific Healthcare also added that the purchaser is not related to the company, its directors or substantial shareholders.

Pacific Healthcare closed 3.3% lower at 2.9 cents today.