October 15, 2019 at 08:55 pm
Jenniffer B. Austria
Infrastructure conglomerate Metro Pacific Investments Corp. said Tuesday it deferred the P83.3-billion initial public offering of unit Metro Pacific Hospital Holdings Inc. and will instead sell P35.3 billion shares to US investment fund KKR and Singapore sovereign wealth fund GIC Pte.
Under the definitive agreements signed by the parties, the KKR-led consortium will subscribe to P5.2 billion worth of 41,366,178 new common shares or 6.25 percent stake in MPHHI.
KKR will also invest in a P30.1-billion convertible bond to be issued by MPIC. The bond will entitle KKR-led consortium the right to exchange the bond for 239,932,962 common shares in MPHHI within a 10-year period. The deal is expected to be completed before the end of 2019.
Proceeds from the sale of shares in the company are expected to support MPHHI’s potential investments in more hospitals and new healthcare businesses.
MPHHI president and chief executive Augusto Palisoc said the KKR investment would enable the company to further grow its hospital network to 5,000 beds and 30 hospitals before 2030.
“We also look forward to accessing KKR’s various healthcare companies in its global portfolio, to bring over new technologies and processes to improve healthcare services in our country,” Palisoc said.
MPHHI is the operator of the largest private hospitals and healthcare network in the Philippines in terms of authorized bed capacity and revenue. It has interests in 14 hospitals with 3,200 beds across the country.
“I am delighted that we are able to announce this new partnership in the healthcare sector, which is an extension of our successful relationship with KKR with its investment in Voyager Innovations, a digital technology company of MPIC’s sister company PLDT,” MPIC chairman Manuel Pangilinan said.
MPIC president Jose Ma. Lim said the company decided to postpone for now the planned IPO of MPHHI as they believed that that best way forward for MPHHI and MPIC is with the new partnership with KKR.
Ashish Shastry, co-head of Asia Pacific Private Equity and Head of Southeast Asia at KKR, said: “Today’s announcement is not only about bringing operational value and capital support to this business ― it’s about supporting the impressive doctors, nurses and healthcare practitioners at Metro Pacific Hospitals who help millions of patients across the Philippines. Metro Pacific Hospitals exemplifies the type of high-caliber company KKR looks to work with, and we are thrilled to play a role in the development of the Philippines’ healthcare infrastructure”.
KKR has a long track record of supporting companies in the global healthcare sector.