Temasek sells out of Thai hospital; on the sly?
This week, a letter to the Stock Exchange of Thailand revealed that a 12.6% stake in Bumrungrad Hospital had been sold mid-January by several investors, one of which included Singaporean sovereign wealth fund, Temasek Holdings. Interestingly, the letter seemed to indicate that the hospital had not been notified prior to the sale, and that two of the sellers had yet to be identified as of the 17th of January.
Director of Bumrungrad Hospital, Dhanit Dheandhanoo, said that the group had been told by Temasek that the SWF sold nearly 42.7 million shares for THB29.25 ($0.95) per share, or a total of THB1.25 billion ($408 million). This amounts to a sale of around 5.85% of the company. In the short letter, Dheandhanoo also stated that the transaction should not "materially affect" the company's shareholding or management structure.
Oddly, the hospital was still looking into the nature of the other two transactions in which shareholders sold an additional 49 million shares. Although unconfirmed, one of the other sellers could potentially be Istithmar PJSC of the United Arab Emirates, Temasek's co-investor when the firms jointly took up 86.7 million shares back in January 2006.
A publicly touted deal when it was inked, Temasek and Istithmar purchased their respective stakes (43,370,743 shares each, or 5.94% each) in the Thai hospital group nearly five years ago to the day. They paid THB25 ($0.64 based on historical rates) per share, based on "the weighted average share price prevailing at the time the discussions initially took place" according to a statement dated January 20, 2006. Given the buy price and currency exchange rates, Temasek has made a nearly 20% profit on the deal and still holds 704,500 shares, or a less than 1% stake.
Bumrungrad is the largest private hospital in Southeast Asia, and Tan Suan Swee, MD, Investments, of Temasek Holdings previously stated that it was "an attractive investment with good domestic and regional growth potential. This investment also reinforces our positive outlook on the prospects of the healthcare sector in this region." The release seemed to indicate that initial discussions with the hospital group had been ongoing, and that the arrangement was mutually beneficial.
Industry sources indicated to AVCJ that selling of a stake - even a minority stake like this - without speaking with the company first is highly unusual. A spokeswoman for Temasek confirmed reports of the sale, but would not elaborate on the circumstances, timing, or any other details.
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