Hospital chain Aster DM to sell majority stake in Gulf business for $1 bln (updated)

Aster DM Quality Care

28/11/2023 16:58

(recasts lead, adds details on sale, executive quotes)
    By Hadeel Al Sayegh and Rishika  Sadam
       BENGALURU/HYDERABAD Nov 28 (Reuters) - Hospital chain
Aster DM Healthcare  ATRD.NS  has agreed to sell a majority
stake in its Gulf business to an investor group based in the
region for $1 billion as part of a plan to separate the unit
from its Indian entity.
    The offloading of a 65% stake in the business to a
consortium led by private-equity firm Fajr Capital brings to a
close a year-long sale process after the business was seen as
undervalued by some of its investors. 
        The investor group also comprises UAE sovereign wealth
fund Emirates Investment Authority, Al Dhow Holding Co, Wafra
International Investment Co and Saudi Arabian billionaire Olayan
family's Hana Investment. 
  
        Aster promoter, Moopen Family, will hold the remaining
stake in the unit 
  
    The move will help Aster focus more on its India business,
in which it also plans to sell a 30% stake for about $300
million as it plans to go on an expansion spree.
    Alisha Moopen, managing director of Aster's Gulf business,
told Reuters that the stake sale gives the company more
flexibility to pursue growth.
    "I think there is a lot of opportunities for inorganic
growth in India which we haven't been able to pursue so actively
because of this conflicting requirements and investment in
capital requirements between the two regions," Moopen said.
    Aster DM currently operates 32 hospitals, 127 clinics and
521 pharmacies in India and the UAE. Shares of Aster DM closed
down 1.48%, valuing the company at about $2 billion. 
   The company also plans to scale up expansion in Saudi Arabia,
planning to open 180-200 pharmacies in the next four years,
Moopen said.
    Reuters, in July, reported Aster confirming it was in talks
with Fajr and other parties as part of exploring a potential
carve-out of its Gulf unit.
    

 (Reporting by Hadeel Al Sayegh in Dubai, Rishika Sadam in
Hyderabad and Kashish Tandon in Bengaluru; Editing by Anil
D'Silva)
 ((Rishika.S@thomsonreuters.com;))