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Aster completes separation of GCC and India businesses

Fajr Capital-led consortium completes acquisition of 65% stake in Aster GCC

Aster DM Healthcare Limited, a leading multinational integrated healthcare provider, on Wednesday announced the successful separation of its GCC and India businesses into two distinct and standalone entities. Under the separation plan, a consortium of investors led by Fajr Capital, a sovereign-backed private equity firm, has acquired a 65 per cent stake in Aster GCC, with the Moopen family retaining a 35 per cent stake alongside management and operational rights. The transaction which valued the GCC business at an equity value of around $1 billion has now concluded.

Founded in 1987 by Dr. Azad Moopen, Aster was established as a single clinic in Dubai. The company has since grown to become one of the most trusted healthcare brands in the GCC and India, with its GCC network comprising of 15 hospitals, 117 clinics and 285 pharmacies, spread across UAE, Saudi Arabia, Oman, Qatar and Bahrain.

In November 2023, the company obtained board approvals to separate its GCC and India businesses to establish two distinct healthcare champions that will benefit from the strategic and financial flexibility to meet the priorities of patients and focus on the growing demand in their respective markets. The plan was also approved by the company’s shareholders in January 2024. The transaction was subject to customary regulatory approvals and closing conditions, all of which have been satisfied and concluded.

Dr Azad Moopen will remain the founder chairman and Alisha Moopen will serve as the managing director and group CEO of Aster GCC. The Moopen Family will continue to retain operational control of the company.

The Fajr Capital-led consortium includes Emirates Investment Authority, Al Dhow Holding Company (the investment arm of AlSayer Group), Hana Investment Company (a subsidiary of Olayan Financing Company) and Wafra International Investment Company, among other regional and international investors. Together with the new shareholders, the Moopen family and Aster GCC’s management team will now embark on a regional expansion strategy. In UAE, the company will shortly unveil Medcare Royal Hospital, a 126-bed super specialty hospital in Al Qusais which will serve as a world-class destination for tertiary and quaternary care catering to local and international patients. Meanwhile, the Aster Pharmacy business in Saudi Arabia is poised for substantial growth, with 180 new retail stores set to open within the next 3-5 years. Additionally, Aster Sanad Hospital in Riyadh is set to expand its bed capacity to serve a larger population segment.

Dr Azad Moopen said: “The separation has established a GCC business which has tremendous growth potential and will be focused on tapping the opportunities in the region. We are glad that Fajr Capital and its consortium of partners has chosen to partner with us on this growth journey and we are confident that their demonstrated expertise will empower our expansion plans within GCC’s dynamic healthcare landscape, especially Saudi Arabia. Together, we envision a future where Aster’s business in the GCC continues to deliver best-in-class healthcare services to its patients across the region.”

“Today’s announcement marks the beginning of an exciting new chapter for Aster in the GCC,” added Iqbal Khan, CEO of Fajr Capital. “Healthcare remains one of the largest, most pivotal and dynamic sectors in the regional economy. With its deep regional roots, Aster has emerged as a healthcare champion in the GCC and benefits from a strong market presence, exceptional workforce and an unwavering commitment to providing the highest quality of healthcare to the regional population. We are pleased to have the opportunity to partner with Dr Azad, Alisha and the Moopen family, who share our values and vision for the business, and look forward to working with them and the leadership team to unlock Aster’s tremendous potential in the GCC.”

Alisha Moopen, managing director and group CEO of Aster DM Healthcare GCC said: “We are truly excited to embark on our next stage of growth which would see us expand our footprint in GCC while strengthening our presence across physical and digital channels to meet the evolving healthcare needs of our patients and customers. We are actively developing the right market strategy for Saudi Arabia for the expansion of our primary care and hospital businesses, supported by our new partners, and we will continue to further strengthen our pole position in the existing markets simultaneously. We believe that Fajr Capital’s M&A expertise and strategic counsel would be of utmost importance in this journey.”

EY and PwC provided independent valuation advice and ICICI Securities provided fairness opinion for the valuation guidance for the Company. Moelis & Company and Credit Suisse acted as the sell-side advisors. Baker & McKenzie LLP was the sell-side’s legal advisors, while Cyril Amarchand Mangaldas was Aster’s lawyer on the transaction. AZB & Partners were the advisors to independent directors. HSBC Bank Middle East Ltd., Allen & Overy LLP and PwC acted on behalf of the Fajr Capital consortium.