Aster DM says India, GCC business split nears closure

Wam

Hospital chain Aster DM Healthcare has confirmed that the separation of its GCC and Indian businesses and the proposed investment in the former by a Dubai private equity firm are nearing completion. 

The company agreed to sell a 65 percent stake in its Gulf business to a state-backed Fajr Capital-led consortium for $1 billion in November 2023.

The plan received the shareholders’ nod in January.

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The consortium has obtained necessary approvals from Saudi Arabia’s General Authority for Competition.

All conditions outlined in the sales and purchase agreement are now complete, Aster DM said in a statement published on the Bombay Stock Exchange. 

No objection certificates have been received from key partners, and regulatory authorities in the GCC have been informed of the closure of the business separation.

Meanwhile, business operations in Qatar with Aster DM Healthcare have been completed.

• Dubai hospitals are ailing in saturated healthcare market
• $112bn of trade with India ‘ready to be tapped’
• Aster DM plans dividend payout from Gulf unit sale

Dr Azad Moopen, the founder chairman of Aster, will continue to operate the GCC business, retaining a 35 percent stake in the company. Existing shareholders will remain with Aster DM Healthcare Ltd, the India-listed entity. 

Upon completing the transaction, the company plans to distribute between 70 percent and 80 percent of the $903 million proceeds it will receive from selling its Gulf business.

“The separation of Aster’s India and GCC businesses will unlock their value and potential and provide the needed impetus for the company to further strengthen its presence in both geographies,” said Moopen. 

Alisha Moopen, CEO of Aster’s GCC business, said the company will expand its presence in Saudi Arabia and further strengthen its footprint in the UAE, Oman and Qatar.  

In the GCC, Aster plans to expand its Aster Pharmacy business in Saudi Arabia, with 180 retail stores set to open within the next three to five years. In addition, the Aster Sanad Hospital in Riyadh will be expanded. 

In the UAE, the company will launch Medcare Royal Hospital, a 126-bed specialty hospital in Al Qusais.

In terms of India, Aster plans to add 1,500 beds by 2027, investing Rs8.5-9 billion ($102-108 million).