Neunggok Medical Foundation in the Seoul metropolitan area goes up for sale as new entrants are blocked; finding a new owner for Neunggok Medical Foundation [fn Market Watch]

Financial News = Neunggok Medical Foundation, a medical corporation operating a long-term care hospital in Siheung City, Gyeonggi Province, has begun seeking a new owner in the rehabilitation M&A market. The key point to watch is that this deal could secure an existing medical corporation and hospital-bed licenses in the Seoul metropolitan area, where barriers to establishing new medical corporations and supplying beds have become higher.
According to investment banking and related industry sources on the 31st, Neunggok Medical Foundation has selected Samil PricewaterhouseCoopers as its sale adviser and is pursuing a pre-approval M&A deal.
Given the nonprofit nature of medical corporations, the transaction will not involve a typical equity acquisition. Instead, it will proceed as an investment attraction through a capital contribution and loan arrangement. To speed up the deal and improve certainty, the foundation is pursuing a stalking horse strategy, in which it signs a conditional investment agreement with a preliminary buyer before launching a public auction and then seeks a bidder offering better terms.
Founded in 2015, Neunggok Medical Foundation operates Neunggok Long-term Care Hospital in Siheung City with four departments and 132 beds. Its 2025 revenue is estimated at about 3.1 billion won.
In its early years, the foundation was hit by a so-called fake doctor scandal, which led to a suspension of long-term care insurance reimbursements for about a year and made management difficult. Its financial structure later deteriorated as it became increasingly dependent on outside borrowing, while the COVID-19 pandemic reduced revenue and fixed costs remained high.
Last year, liquidity worsened sharply as the company faced severance pay burdens from mass employee resignations, creditor seizures, and delays in extending loan maturities. It eventually filed for rehabilitation with the Suwon Bankruptcy Court in December 2025 and received approval to begin proceedings in February this year.
What the market is focusing on in this deal is the scarcity of existing medical corporations and hospital-bed licenses.
In fact, to establish a new medical corporation in Gyeonggi Province, applicants must secure their own real estate and contributed assets, and also overcome bed supply regulations.
In particular, the Ansan secondary medical service area, which includes Siheung City, is designated as a bed supply adjustment zone, making new entry difficult. Acquiring an existing medical corporation and securing a base for bed operations could therefore be an alternative.
As the population ages, demand for long-term care is rising, but supply is shrinking. The number of long-term care hospitals in South Korea fell from 1,549 in 2018 to 1,299 in the first quarter of this year. By contrast, the population aged 65 and older reached 10.84 million last year, accounting for more than 21% of the total population.
Neunggok Long-term Care Hospital also has a station-area location and could convert some idle space into rental use. The foundation estimates that leasing 222.5 square meters of unused space on the third floor could generate about 40 million won in additional annual rental income.
Meanwhile, the IB industry is paying attention to the fact that this is not simply a turnaround of an unprofitable long-term care hospital, but a rehabilitation M&A deal aimed at securing medical corporation licenses, where new supply is restricted by regulation.
An IB industry official said, "In the Seoul metropolitan area, the barriers to establishing new medical corporations and securing beds are high, so the scarcity of existing licenses is relatively greater," adding, "The key issue in the bidding process will be how investors assess post-turnaround bed utilization and the value of existing licenses, rather than current earnings."


[email protected] Kim Kyung-a Reporter