HarmonyBridge Children's Health & Rehabilitation Centres Business Plan — Funding Requirement & Capital Structure

Series A — use of funds

Uses (Series A)	R m	Sources	R m
120-bed flagship facility	420	Series A equity	450
Medical equipment	110	Series A term debt	250
Digital systems	35
Working capital	85
Marketing & launch	15
Staff recruitment & training	35
Total	700	Total	700

Figure 20. *Use of funds across the R700m Series A.*

The two-round funding structure

Consistent with the invitation to structure the raise across funding rounds, the plan is capitalised in two stages, each blending equity and term debt. The R700 million Series A (R450 million equity and R250 million debt) funds the flagship, equipment, digital platform, working capital, launch and recruitment. The R600 million Series B (R380 million equity and R220 million debt), raised once the flagship demonstrates occupancy, outcomes and payer contracting, funds the Pretoria and Cape Town centres and the start of regional expansion. Staging the capital reduces early dilution, matches funding to proven performance, and gives investors and lenders natural decision points, with the debt secured against the facilities and sized conservatively against maturing cash flow.

Round	Equity	Debt	Total	Timing & purpose
Series A	R450m	R250m	R700m	Year 1 — flagship & launch
Series B	R380m	R220m	R600m	Year 3 — metro network & expansion
Total	R830m	R470m	R1,300m	Full Phase-1 build to Year 5

Debt service and covenant headroom

Credit metric	Year 1	Year 2	Year 3	Year 4	Year 5
Term debt (R m)	250	250	470	432	398
Debt service (R m)	32.5	32.5	61.1	98.7	90.8
DSCR (x)	0.44×	1.48×	1.64×	1.77×	3.03×
Net debt / EBITDA (x)	10.6×	3.9×	2.6×	1.3×	0.8×

Figure 21. *Term debt and debt-service cover.*

Analyst flagDebt must be structured to the J-curve — grace period and reserves are essential

Debt-service cover is below 1.0× in Year 1 as the flagship carries full financing on ramping occupancy, before strengthening to comfortable levels (above 1.6× from Year 3 and 3× by Year 5) as EBITDA grows. This is a ramp-timing issue, not a fundamental one, but it must be structured for: an interest-only or grace period on the term debt through construction and early ramp, a debt-service reserve, covenant headroom sized to the ramp, and the equity-heavy funding mix already built into the plan. Development-finance and impact lenders, familiar with healthcare-infrastructure ramps, are natural partners for this structure.

HarmonyBridge Children’s Health & Rehabilitation Centres Business Plan — Funding Requirement & Capital Structure

Series A — use of funds

The two-round funding structure

Debt service and covenant headroom