Aureos, GSB exit Thai hospital interest to Malaysia’s KPJ
Aureos Capital and GSB Private Funds – a vehicle set up by Thailand’s Government Savings Bank and managed by ING – have agreed to exit their holdings in Vejthani Hospital to KPJ Healthcare, a hospital chain with assets in Malaysia and Indonesia for THB605.6 million ($19.7 million). They originally invested THB200 million in 2009.
Aureos Southeast Asia Fund and GSB will sell 5.3 million and 2.7 million shares, respectively, in hospital operator Vejthani Public Company. The deal, which is scheduled to close in the second quarter of 2013, values Vejthani at 9x forward EBITDA less net debt.
KPJ will fund the acquisition through MYR54.5 million ($17.9 million) in debt and MYR6.1 million from its own reserves. According to DBS, Vejthani will deliver an EBITDA of MYR32.1 million for the 2012 fiscal year, which translates to a MYR7.5 million contribution to KPJ's overall EBITDA, or 2.3% of the sum projected for the 2013 fiscal year.
Vejthani Hospital was established in 1994 and currently has a capacity of 500 beds, including 10 suites and 11 VIP suites, as well adult and pediatric intensive care units, and a renal dialysis unit. It sees more than 300,000 patients per year.
KPJ has a network of 12 hospitals in Malaysia and two in Indonesia, with more than 2,600 beds. It treated around 2.4 million outpatients and 240,000 inpatients in 2011. Turnover was up 14% year-on-year to MYR1.891 billion while net profit grew 11% to MYR131.7 million. There was a 40% increase in the number of international patients as KPJ broadened its exposure to the medical tourism industry.
The company said last year that it wanted to acquire 1-2 new hospitals in the next five years via acquisitions and greenfield developments.
Further consolidation is expected in Southeast Asia's healthcare sector. The largest player by some distance is IHH Healthcare, a hospital operator owned by Malaysian sovereign wealth fund Khazanah Nasional, which raised MYR6.3 billion from its IPO earlier this year.
IHH's assets include Singapore's Parkway Holdings India's Apollo Hospitals Enterprise and Malaysia-based Pantai Hospital. Khazanah bought Parkway in July 2010 for $2.56 billion.
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