The management of SGX Mainboard-listed Health Management International (HMI) and private equity firm EQT have offered to take the healthcare provider private in a deal that values it at S$611 million ($449 million).
HMI Group owns two tertiary hospitals in Malaysia, as well as a one-stop ambulatory care centre and healthcare training centre in Singapore.
EQT is backing the offer through PanAsia Health Limited, a special purpose vehicle indirectly controlled by EQT Mid Market Asia III GP.
Under the scheme of arrangement, HMI shareholders can either accept a cash consideration of S$0.73 per share or receive new shares in PanAsia, issued at S$0.73. The offer price represents a 24.8 per cent premium over the volume weighted average price (VWAP) of HMI shares over the last one month.
HMI shares last traded at S$0.66 on Thursday before a trading halt was announced on Friday.
In a joint media statement, HMI and EQT said they have received an irrevocable undertaking to accept the offer from HMI shareholders who own an aggregate of 61.8 per cent. These include the Chin family, which owns HMI, and Malaysia’s Maju Medik.
“We welcome EQT as our partner in HMI. Given their deep experience across the various healthcare ecosystems globally, we believe they will add value to HMI’s growth strategy to become one of the leading private healthcare providers in the region,” said HMI Group CEO Chin Wei Jia.
“EQT is excited by the opportunity to invest in a reputable private healthcare provider with a regional Southeast Asian presence and high quality management team,” said Brian Chang, Partner at EQT Singapore and Investment Advisor to EQT GP.
If the scheme of arrangement is passed, EQT will hold a stake of between 18.6 per cent and 30.5 per cent in HMI, while the Chin family will own between 30 per cent and 42.4 per cent.
The Chin family has undertaken to facilitate EQT’s exit from HMI by working towards an initial public offering (IPO) of the offeror within 18 months after four years from the date the scheme is effective.
If an IPO does not materialise, Nam See Investments, a Chin family vehicle, will assist with the sale of EQT’s stake. If the stake sale is not completed by the sixth year, Nam See will write EQT a put option for all its shares.
EQT has committed an equity line of up to $150 million to HMI for any potential acquisitions or investments.