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‘Circle Health and BMI Healthcare are in talks to merge in near future’
Posted on Friday, 29 November 2019 13:09
The Financial Times (FT) observed that Circle Health is in talks to acquire one of the UK’s largest private hospital chains, BMI Healthcare, and is expected to sign an agreement in December.

A deal would significantly boost the much smaller state-of-the-art hospital group in Bath, Nottingham and Reading to a combined business with GBP 1.00 billion in revenues and a total 57 healthcare facilities.

BMI Healthcare, which is being advised by Rothschild, according to the FT, is owned by investors including Centerbridge, which holds a 47.0 per cent stake acquired from from Netcare last year.

The previous shareholder had to sell the company after being hit by rising rent costs, increased debts and a decline in private medical insurance and NHS work, the newspaper observed.

Should Circle Health’s acquisition be successful, it would come as a relief to investors, the FT noted, after a number of large healthcare deals flopped due to the uncertainty around the UK’s decision to leave the EU.

Citing one person familiar with the matter, the newspaper said the potential buyer sees BMI Healthcare as an opportunity to bring new technology to their hospitals.

However, there can be no guarantee the deal will not face regulatory hurdles as both companies own facilities in Bath.

According to BMI Healthcare’s website, it owns 54 hospitals and clinics with over 6,500 consultant specialists and 1.70 billion outpatient visits per year.

Zephyr, the M&A database published by Bureau van Dijk, shows there have been just nine deals targeting UK-based hospital operators announced since the start of 2019.

The top three of these deals involved private healthcare provider Mediclinic International, the largest being a GBP 151.52 million investment by Genesis Investment, followed by Genesis Asset Mangers selling 5.2 per cent for GBP 115.00 million and Mpilo Investment Holdings No 2 offloading 3.3 per cent of the company for GBP 75.00 million.

Other targets included Private Clinic CSC, 352 Medical, Parallabs and Bath Fertility Centre.

© Zephus Ltd