Australian-based private equity funds Pacific Equity Partners and Crescent Capital are believed to be in the mix to buy New Zealand primary health care provider Tamaki Health.
The business generates about $NZ40m ($A38.5m) of annual earnings before interest, tax, depreciation and amortisation and is expected to sell for more than $NZ400m.
The company is owned by private equity firm Mercury Capital, headed up by New Zealand’s former Goldman Sachs head Clark Perkins, who is now based in Sydney.
Tamaki operates general practices in South Auckland, with a network of more than 40 clinics that offer more than a million consultations annually, predominantly serving the Maori and Pacific Island communities with affordable healthcare services.
PEP and Crescent are two of the most active buyout funds in the Australia and New Zealand healthcare space.
Sydney-based PEP this year purchased a portfolio of about a dozen Australian hospitals and some Day Centres within the Healthe Care business from China’s Luye for more than $400m. Crescent Capital was the under bidder in the contest.
Crescent is currently selling clinical trial specialist Nucleus Network in an auction that has attracted private equity bidders and this year floated its Australian Clinical Labs business at a value of $809m.
PEP has also put on the market its Evolution Healthcare business that consists of regional hospitals across the Tasman through Stanton Road Partners.
PEP purchased Evolution Healthcare in March 2019 for a price thought to be about $300m.
The business is overseen by its founder Ben Thynne, who also founded Healthe Care, and run by former Virtus Health boss Sue Channon.
PEP describes Evolution as a leading provider of private hospitals and rehabilitation services in New Zealand and Australia, with the Wakefield Hospital in Wellington its most valuable asset.
The sales process is now underway with information memorandums out in the market and first round bids due in the second half of October.
As earlier reported by DataRoom, parties lining up for the business are understood to include Ontario Teachers Pension Plan, the Dutch Infrastructure Fund and QIC, while Brookfield and NZ Super are also expected to be contenders.
The healthcare auctions are heating up across the Tasman as Morrison & Co edges towards a deal to buy Australia’s largest cancer care provider Icon Group.
DataRoom understands that Morrison is looking to write out a cheque close to $2.5bn to buy the business.
Healthcare assets remain in strong demand by buyout funds, attracted to the industry’s low risk profile amid a low interest rate environment and growing earnings linked to an ageing population.
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