Helios Kliniken has bought five hospitals, with total sales of €136m, in two deals announced just before Christmas.

Three of the hospitals are in Mansfeld Sudharz in Saxony-Anhalt, and two are in Northeim, Lower Saxony. The company did not reveal the price, but analyst Volker Braun at Commerzbank says he doesn’t think it differed from the normal PE multiple of 0.9-1.1 times sales.

However, the Mansfeld Sudharz deal is very different from the norm. Local press report that Helios is paying €75m upfront, with only 30% to follow over the following years.

This is substantially different from the usual deal structure, where the acquirer pays 10%-30% upfront and the remainder is invested later. This, for example is the likely to be the pattern with the Helios deal in Northeim, where Helios has pledged to build a brand new hospital.

The rather odd structuring reflects the fact that the EU and the German government recently spent no less than €240 million on re-equipping the three Mansfeld Sudharz hospitals.

Says Braun: “The good news is that Helios is getting a lot of real estate for not very much. The bad news is that they are paying a lot up front for a business which is still losing money.”

Nor is Helios likely to be able to unlock the value quickly - Braun doesn’t expect sales and leasebacks on German hospitals for at least another five years.

Major rival, Rhoen Klinikum, is likely to have mixed feelings about this deal. When it bought the University hospital of Giessen and Marburg, it pledged to invest around €170m to build a brand new hospital in Giessen!

Helios expects sales to rise from €1.8bn in 2007 to €2.3bn in 2010, implying average acquisitions of €150m a year.