Amanat Holdings, an education and healthcare investment specialist, received a nod from its board to buy a strategic stake in VPS Healthcare, as it looks to expand its portfolio of investments in the region.
Amanat has formed a “special steering committee” to consider the potential investment opportunity and discuss “terms of the transaction” with VPS, the company said in a bourse filing to the Dubai Financial Market, where its shares trade.
The committee will appoint external advisers and an independent “valuer” for the deal, it added.
Last week Amanat said it was assessing buying a stake in the Middle East operations of VPS Healthcare. It did not disclose the size or the value of the stake.
The potential deal, which is in line with its strategy to grow and scale profitably within the region, could help consolidate its position within the healthcare industry. Amanat has appointed JP Morgan as financial advisor on the transaction, which is subject to securing necessary regulatory approvals.
Founded in 2007 by Dr. Shamsheer Vayalil, VPS Healthcare is one of the UAE’s more diversified healthcare firms. It operates more than 20 hospitals and 125 medical centres across the Middle East and India. VPS also runs a UAE integrated pharmaceutical firm known as Lifepharma and a pharmacy chain based in Abu Dhabi.
Mr Vayalil, who is also the vice-chairman and managing director at Amanat, will not be a part of the discussions related to the transaction, Amanat said, addressing concerns of conflict of interest.
Amanat has said a stake in VPS could help it tap a booming healthcare industry within the GCC, which it expects to grow at a compound annual growth rate of 6.7 per cent by 2022. The company forecasts growth to be supplemented by government spending in the sector, which is set to grow to $30.5 billion (Dh112bn) by 2021.
“Such fundamentals support Amanat to build long-term value for shareholders through a combination of scale, synergy and expertise when the right opportunity is presented,” the Dubai-based firm said last week.
In November, Amanat's chief executive Tristan de Boysson told The National the company plans to invest as much as Dh900m in GCC and Egyptian markets over the next few years.
At the time, the company said that it had Dh536m in cash, which it could deploy into its target markets and said it planned to raise a further Dh300m-Dh400m through bank loans.
