Ramsay, Sime Darby to sell Asia healthcare JV to Columbia Asia for $1.2 billion

By Upasana Singh and Yantoultra Ngui

(Reuters) -Malaysian conglomerate Sime Darby said on Friday Ramsay Sime Darby Health Care, its 50-50 joint venture with Australia’s Ramsay Health Care, will be sold for 5.7 billion ringgit ($1.21 billion).

Sime Darby said its unit Sime Darby Holding and Ramsay’s subsidiary AH Holdings Health Care had on Friday entered into the sale and purchase agreement with Malaysian-based private hospital chain Columbia Asia Healthcare.

“The offer from Columbia Asia was one we could not refuse,” said Sime Darby’s Group Chief Executive Officer Jeffri Salim Davidson in a statement.

“While the hospital business is a great asset, we have always maintained our focus on our core trading businesses of motors and industrial,” he added.

The announcement confirmed a report by Reuters on Tuesday saying that Columbia Asia, a Southeast Asian healthcare firm backed by alternative asset firm TPG, was the frontrunner to buy Ramsay Sime Darby.

The sale will enable Sime Darby to unlock the value of its healthcare assets, which have previously been deemed non-core, with a 2 billion ringgit gain on disposal of the stake, the company said in a statement.

Ramsay, Australia’s largest private hospitals operator, did not immediately respond to Reuters’ request seeking comment outside of working hours.

The deal marks the largest Southeast Asian healthcare acquisition since 2019 when Malaysian conglomerate Hong Leong Group and TPG bought Columbia Asia’s assets for about $1.2 billion.

Besides Hong Leong and TPG, sovereign wealth fund Abu Dhabi Investment Authority and Malaysian state pension fund Employees Provident Fund will provide new capital to fund the transaction, Sime Darby said.

Post transaction, both co-investors will have a combined shareholding of around 25% in One Health Holdings, the TPG-owned and controlled unit that owns Columbia Asia, the statement showed.

Started in 1996, Columbia Asia currently has 22 medical facilities in Malaysia, Vietnam and Indonesia and focuses on building mid-size hospitals in residential areas, according to its website.

Sime Darby expects the deal to be completed in the third quarter of fiscal 2024.

($1 = 4.7060 ringgit)

(Reporting by Upasana Singh in Bengaluru and Yantoultra Ngui in Singapore; Editing by Sonia Cheema and David Evans)