Metro Pacific is owned by a collection of Filipino and Indonesian tycoons such as Ramon Ang, the Ty family, Manuel V. Pangilinan, Anthoni Salim, and the Japanese conglomerate Mitsui. The huge size of the deal means they will need to bring in additional financial firepower.
At the estimated valuation of $3 billion (P167 billion)—double the figure from when KKR and GIC entered five years ago—the sellers' 80 percent stake would be priced at $2.4 billion or about P133 billion.
InsiderPH learned that Metro Pacific, which owns 20 percent, is ready to repurchase some of those shares at the higher price to become the hospital group’s single-largest owner.
It also plans to enlist the help of about two other moneyed—and preferably foreign—partners to buy the remaining shares.
“This is a joint exercise. They will be selling 80 percent and we are preparing to take up to 25 percent with other investors as long as there’s not one other investor that will have a bigger stake than us,” the insider said.
The valuation spike is a testament to Metro Pacific’s efforts, supported by KKR and GIC, which helped expand the company’s healthcare portfolio from 14 to 25 hospitals.
These include the Makati Medical Center, Cardinal Santos Medical Center, and Davao Doctors Hospital.
While the value may seem huge by domestic standards, the insider said this was acceptable when compared to international deals.
One recent example in Malaysia is IHH Healthcare’s purchase of the 600-bed Island Hospital in Penang for $900 million.
This makes the $3 billion valuation for Metro Pacific’s hospitals, whose network spans over 4,000 beds, justifiable by comparison, the insider said.
As for a potential healthcare initial public offering (IPO), it could still take more time. The insider said the case for an IPO becomes stronger if the network expands to about 40-50 hospitals
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
