Well, hello and welcome to this Web Conference where we will provide insights on today's news regarding our acquisition of Team Olivia's operations in Norway. My name is Johanna Rastad, and I'm the CEO of Humana. With me today, I have our country manager in Norway, Mona Lien, and our CFO, Fredrik Larsson. At the end of this presentation, you're welcome to dial in and ask questions. However, since we are in a quiet period prior to our first quarter 2024 report, we will answer to questions solely relating to the acquisition and will not provide any projections. Next page, please, Ewelina. So we are very happy to announce that we have today signed an agreement to acquire Team Olivia's operations in Norway, and that we're now expanding and strengthening our well-managed and, actually, since many years, well-performing business in Norway.
The acquisition has a perfect fit within Humana's current service portfolio and will double the size of our care service division in Norway, including personal assistance, disability care homes, youth homes, open care, and family services. This will enable us to specialize even more and strengthen our services within complex care needs. Team Olivia has been able to grow fast by building strong care concepts, which is something that we can further leverage within Humana. The acquisition will clearly further strengthen Humana's footprint in Norway. Team Olivia provides a very good strategic fit, not only implementing specialization, but we will also have a complementary service offering, providing better geographical coverage, adding strong competence, and we will be able to sharpen our offering to clients and payers.
Both Team Olivia Norway and Humana Norway have seen stable and high growth in the last couple of years, and together we are better suited to benefit from this momentum. Humana has also historically delivered a higher margin than Team Olivia in Norway, and we see that the operational excellence we can implement in the combined entity, as well as the identified synergies of merging two similar operations, will provide a strong foundation for profitable growth. Expected synergies are estimated to just above SEK 20 million in 2025, including operational improvements and direct cost synergies. The purchase price of SEK 341 million corresponds to 7.2x EBITDA before synergies and 5x after expected synergies. Next page, please. So looking at Team Olivia's contribution to the group, revenue will increase by 9% to about SEK 10.5 billion.
The combined entity in Norway will have a turnover of just above SEK 2 billion, corresponding to close to a fifth of the total turnover of the group. The combined entity will generate EBITDA of SEK 122 million, representing EBITDA margin of 6% based on 23 figures, so that's ex-synergies. The transaction is expected to be EPS accretive from 2025. That said, the acquisition will contribute to underlying positive EPS already in 2024. I will now leave the word for our country manager in Norway, Mona Lien.
Thank you, Johanna. I really share your enthusiasm for today's news. As you know, we have worked hard in Norway to provide a strong qualitative offer to our clients, which has resulted in strong organic growth. For a long time now, we have sought to complement our operations with an acquisition. Therefore, I'm happy to share with you today that with Team Olivia's operations in Norway, we have found an organization with strong values, strong competence, and the same prioritization to build the organization around the clients' and customers' needs. Team Olivia will complement our existing operations, and we have good potential for a successful integration. Team Olivia provides personal assistance all over Norway under the brand Assister Meg, covering about 120 municipalities. Moreover, they provide disability care homes under the brand BoHjemme and institutional youth care through Solhaugen.
In 2023, they reached a revenue of 913 SEK and EBITDA of 47 million SEK, corresponding to an EBITDA margin of 5.2%. We are confident that the acquisition will be positive for our operations in Norway and that we will be able to achieve the outlined synergies. The acquisition strengthens Humana's position on the Norwegian care market, which I strongly believe will benefit the clients and the customers at the end. Our combined operations will provide a higher level of security and stability while the personal service remains. Cooperation benefits mean good opportunities to improve the quality of the offer to both customers and users as more resources can be allocated to the operational activities. And with that, I will leave the word over to our CFO, Fredrik Larsson.
Thank you, Mona. The agreed purchase price is SEK 341 million on a cash and debt-free basis. The purchase price will be paid partly with existing cash amounting to SEK 236 million and by issuing a fixed number of 4 million new shares in Humana AB. The value of the new shares is equal to SEK 105 million at a share price of SEK 26.30 per Friday. The transaction is subject to competition authority approval, and we are expecting to receive such approval, and that approval is expected to make sure that we can close the transaction during the second half of this quarter. At closing, the cash purchase price will be paid, and the 4 million shares will be issued. The shares to be issued corresponds to 7.7% of the total number of shares after the share issue.
The share issue will be resolved by the board of Humana AB based on its authorization from the annual general meeting in 2023. To summarize, we expect the transaction to positively contribute to EBIT and cash generation in the second half of 2024 and to be EPS accretive from day one, excluding non-recurring items. Today, we have a strong financial position, and the acquisition has limited impact on Humana's net debt to EBITDA. With that, back to you, Johanna.
Thank you very much, Fredrik. For the group as a whole, we see great potential in expanding in Norway. We have good leadership and a solid organization to be able to integrate and benefit from the combined operations in the best possible manner. With that, we open up for questions.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. The next question comes from Jakob Lembke from SEB. Please go ahead.
Hi and good morning, everyone. My first question is regarding the margin here for the Team Olivia Norway business, around 5% in 2023. Would you say that that is sort of representative of what this business should do, or is it sort of pressured in any way or inflated? What can you see?
No, what we can say, it has been stable around 5.2% in 2022 and 2023.
Okay. And I mean, just looking at your Norwegian business, it has historically had a higher margin. And also looking at your individual and family business in Sweden, for example, is the way we should see it that you could do a higher margin in this? Also, I mean, not accounting for the synergies.
Yeah, definitely. I mean, that's one part of why we also find this very attractive, that we see that the combined entity in Norway will be very strong. I mean, we have seen both Team Olivia, Norway, and our own Norwegian business has grown sort of rapidly, and we also see a potential to lift margins over time. So there is no reason why not, disregarding synergies, the Team Olivia Norway operations should be able to reach the levels we see at Humana Norway. And for that, then you add synergies to that. So we see very positively on that potential.
Okay. Then I'm just wondering a bit regarding the timing of this acquisition. I mean, given that you are departing here, Johanna, just how you think about that and so on.
Yeah, I think that's, I mean, this is something that we've been working on for quite some time. I've looked at opportunities in Norway for many years. We have had very stable operations, well-managed operations over many years, which is why we also think Norway is a very good, we are in a very good position to make this kind of acquisition. And of course, it will be, that's why we also bring in Mona Lien into this call, because she's also someone that's been working with our team for many years. Mona, how many years have you been with us now?
I think it's since 2015 in the team.
Yeah. So you see, she's been a longstanding person in the team. She knows the organization very well. She's been managing Humana Norway in a splendid manner. So this will not be a problem, and it's not going to be any difference me being in this position or someone else.
Okay, sounds good. And just finally, if I recall correctly, I think Team Olivia also has a quite sizable personal assistance business in Sweden, and I guess that is also up for sale, perhaps. Just would be interesting to hear your thoughts about this and if that could be something for you.
Yeah, I think for right now, we're going to make sure that this project sort of comes into place in a smooth manner. And I think that will be the priority. On the other hand, of course, Team Olivia is a well-managed company. So we've seen one part being divested to Attendo and now this part. So who knows what happens in the future? But I think for us, this is something that we've been working on for a long time. It's a very good market for us to expand our operations into. So we're going to make sure that that is completed in a very good way.
Okay, thank you. That's all from me.
Thank you, Jakob.
The next question comes from Karl- Johan Bonnevier from DNB Markets. Please go ahead.
Yes, good morning, Johanna, and all of you. Just continuing on Jacob's question there. Looking at the other parts of Team Olivia, is that something that, obviously, it's a Danish operation that could elevate you slightly and so on. Is there anything that could be coming out of that?
Well, hi, Karl- Johan. We don't know. That is really a question that you should ask the owners of Team Olivia. What we are very pleased about is that this asset has come out. It's a large business. It's a large acquisition for us, also from a historical point of view. So we're going to make sure that this turns out in an even better way than we have sort of counted on. So we're going to focus on that in the near coming future. So we haven't done larger acquisitions for some time, partly due to the leverage, but also because we have felt that we need to do some work internally. And now we feel that we are in a very good position to make this kind of acquisition. And Norway is very well placed to integrate this sort of asset.
Yeah. Looking closer at the Norwegian operation, both you and Team Olivia seem to have had or have had a very good growth profile over the last couple of years. Has it been the same kind of growth drivers for you?
Yeah, partly. I mean, we have. It's actually a very sort of well-fitted organization from that point of view. They have activities in all the areas that we have. And they've also grown sort of rapidly in a similar manner to us, which is also in fairly similar areas too. So we're in good sort of synchronized there. And then I think sort of on the cost side, we have been good at in Humana Norway to be very clear on our cost management and also been able to maintain sort of relatively high margins in this type of industry or this type of parts of the care in Norway. So I think it's a very good fit from that perspective.
Will the combination, would you say you have a full national coverage now with this combination?
Yeah, it's a broader geographical coverage. We will be stronger in some of the areas, for instance, the Oslo and Stavanger region. So that's beneficial for us because it's larger areas. But apart from that, it is complementary in a fairly broad context.
I guess you and your own operation have been doing some cost rationalization and so on. Is that the similar kind of idea with generating these synergies that you are implementing it now on a broader base?
Yeah, absolutely. I mean, this is something that the Norwegian team has been sort of extremely well at doing, sort of driving what we call operational excellence, being careful with both the buying pattern and how we organize our business to be able to make sure that we do it sort of carefully and can maintain high margins. From a synergy perspective, it is primarily in central functions where we see the synergies, for instance, in the form of fewer offices, other overlapping overhead and central costs.
Excellent. Just one final for me. I'm not sure if it was already in the press release. Do you have any assumption or calculation for how the net debt to EBITDA would look post the transaction or from a basis, maybe?
It will be roughly the same.
Roughly the same. Thank you very much. Good luck with the transaction. All the best.
Thank you very much.
Thank you very much, Karl- Johan.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.
Well, thank you very much for listening. If you have any further questions, please feel free to reach out to either Ewelina, Fredrik, or myself, and have a nice continuing day.