Li & Fung considers options for $500 mln Asia healthcare arm, including a sale - sources

CMBC Capital Holdings

16/01/2023 05:45

By Kane Wu and Yantoultra Ngui
       HONG KONG/SINGAPORE, Jan 16 (Reuters) - Hong Kong-based
multinational Li & Fung Ltd is considering options for its Asian
healthcare arm, including a sale, that could value the business
at up to $500 million, two people with direct knowledge of the
matter told Reuters.
    The sources said Li & Fung has asked banks to pitch for
options for IDS Medical Systems Group (idsMED), which provides
integrated solutions of medical equipment, supplies and
services. The people said discussions are at an early stage and
a decision is yet to be made.
    The options could also include an initial public offering,
said one of the sources, both of whom declined to be identified
as the discussions were confidential.
    The Li & Fung arm, which operates in Singapore, Malaysia,
Indonesia, Hong Kong, Philippines, Thailand, China, Taiwan and
Vietnam, could be valued at $400 million to $500 million in a
deal, they said.
    Li & Fung and idsMED did not respond to emailed requests for
comment on Monday.
    The potential sale comes at a time where medical services
companies are gaining favour as investors bet on the healthcare
sector's ability to weather the current challenging economic
environment. 
    In December, India's Suven Pharmaceuticals  SUVH.NS 
announced that U.S. private equity firm Advent International
will buy a 50.1% stake from its promoter Jasti family and
consider merging it with a peer.
    A week earlier, private equity giant KKR & Co  KKR.N 
announced that it will acquire Japanese drug developer Bushu
Pharmaceuticals from Hong Kong's BPEA EQT.
    Founded in 2011 partly by a Li & Fung group executive,
idsMED started doing business in Southeast Asia. Since then it
has brought in Singapore-based venture capital firm EDBI, the
World Bank's International Finance Corporation and Japanese
trading house Mitsubishi Corp  8058.T  as strategic investors
and expanded into Greater China, according to its website.
    It counts over 10,000 healthcare facilities, as clients and
employs 1,800 people, the website shows.
 (Reporting by Kane Wu in Hong Kong and Yantoultra Ngui in
Singapore; Editing by Kenneth Maxwell)
 ((kane.wu@thomsonreuters.com; +85228436590; Reuters Messaging:
kane.wu.thomsonreuters.com@reuters.net))