KKR, CVC, Carlyle line up for Columbia Asia chain

Singapore: Columbia Pacific Management's Asian hospital business has drawn interest from global private equity players including KKR, CVC and Carlyle, in a sale the US investment company sees fetching about $2 billion, sources with knowledge of the matter said.

Columbia Asia is offering a portfolio of 30 mid-sized medical facilities, mainly in India and Malaysia, where healthcare spending is growing rapidly.

A successful deal would make it the biggest transaction in Southeast Asia's hospital sector in nine years and one of the largest in Asia over the last decade, according to data from Refinitiv.

"This type of asset doesn't come to the market too often, and the opportunity to invest in this is not lost on most PE players," said one source.

Another said the sale drew first round, non-binding bids from a number of financial investors, including sovereign wealth funds.

Columbia Asia, part of Seattle-based Columbia Pacific Management, opened its first hospital more than two decades ago. It has 12 hospitals each in India and Malaysia, three in Indonesia, and two hospitals and one clinic in Vietnam.

Columbia Pacific has a separate healthcare venture in China. Interest for the Asian business also came from Ramsay Sime Darby, a venture of Malaysia's Sime Darby Bhd and Australian-listed Ramsay Health Care, and Asia's largest premium hospital group IHH Healthcare, the sources said.

KKR, Carlyle, CVC, IHH and Ramsay Health Care declined comment. There was no immediate response to an email query sent to Columbia Pacific.

The sources declined to be identified as they were not authorised to speak to the media. Monday was the deadline for first round bids, the sources said.

Once the suitors are short-listed, second round bids are expected by the end of June, the sources said.

"Healthcare is hot but the sellers are coming in with some very high expectations," said one executive from a private equity firm.

Columbia Asia said in March 2018 it had raised $210 million from existing investors, led by Mitsui & Co, to help it expand operations. At that time, the hospitals group said it would have 45 hospitals by 2025, based on its current pace of growth.

Mitsui declined comment on the sale process.

Columbia Asia's website says it focuses on setting up mid-size hospitals in residential areas for accessibility and efficiency and to help keep costs down for consumers. Appetite for deal making has been strong in the hospitals sector.

Last November, Mitsui & Co agreed to become the biggest shareholder of IHH Healthcare by paying about $2 billion to increase its stake in the company.