NMC Health eyes Gulf, Asia Pacific acquisitions

The firm said it may tap the bond market if a significant acquisition opportunity arises

UAE healthcare company NMC is reportedly eyeing acquisitions in the Gulf and emerging markets as part of its expansion plans.

Deputy chief executive Prasanth Manghat told Bloomberg that the company was interested in entering Qatar and Saudi Arabia, with a potential deal in the kingdom to come within three to six months.

He added that NMC was considering tapping the bond market for the first time if the opportunity for a bigger deal arises.

“We are considering bonds,” Manghat said. “It all depends on our pipeline during the year. If there are bigger acquisitions, then we may look at debt raising.”

The company, which is listed in London, is not considering a dual listing in local markets, he said.

More broadly, Manghat argued that mandatory health insurance laws and the increasing prevalence of lifestyle related diseases would boost the prospects of healthcare in the Middle East.

But he said low oil prices may impact margins for the next three to five years.

A report released this year by investment bank Alpen Capital forecast the GCC healthcare market would grow at a 12.1 per cent CAGR from an estimated $40.3bn in 2015 to $71.3bn in 2020.

The company said low oil revenues may curtail government spending in the sector but this was expected to lead to wider adoption of the public private partnership model.

“Private sector involvement is becoming imperative to meet the rising demand for healthcare as well as to reduce the burden of costs on the government finances,” Alpen noted.

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