Aster DM shareholders approve sale of GCC business

proposed transaction would now create two geographically focussed pure-play entities

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A view of Aster Medcity. — File photo

Published: Wed 24 Jan 2024, 6:50 PM

Last updated: Wed 24 Jan 2024, 6:51 PM

Aster DM Healthcare Ltd said on Wednesday that it received the requisite majority of shareholder votes for the separation of its GCC business from Indian operations.

Voting on the two resolutions proposed by the company closed on January 22, with 99.9 per cent of shareholders voting in favour of resolutions towards the separation of the GCC business from the group’s Indian operations and the sale of a majority stake in the Gulf business to private equity firm Fajr Capital in a $1 billion deal.

Dr. Azad Moopen, founder and chairman of Aster DM Healthcare, said shareholders have appreciated the long-term value-unlocking opportunity in the separation of the two businesses and have strongly supported the transaction with a landslide vote in favour of the transaction.

“Investors too have shown patience and trust in the company throughout this period. As disclosed earlier, we are looking to declare previously announced dividend soon upon relevant approvals being obtained upon closing of the transaction,” said Dr Moopen.

Dr. Azad Moopen, founder and chairman of Aster DM Healthcare.

Dubai-based Aster DM approved the $1.01 billion sale of its GCC business to Alpha GCC Holdings Ltd in November last year. The ownership will be shared by Aster India's promoters, with fund management handled by Fajr Capital Advisors in a 35:65 ratio at the transaction's close.

Dr Moopen said the proposed transaction would now create two geographically focussed pure-play entities, each with its own capital allocation policy. “The promoters remain committed to both the India and GCC entities and will continue to manage the business as earlier.”

Post-closing of the proposed transaction, the company would consider distributing 70-80 per cent of the upfront consideration of $903 million as a dividend to its shareholders in the range of ₹110 to ₹120 per share, subject to approvals required under the law.

The closing of the transaction is subject to the completion of certain conditions precedent which are in the advanced stages of completion

The Indian healthcare market, with a population of 1.4 billion to serve, is poised for rapid and sustainable growth in the next few years. With its aggressive growth plans, Aster DM Healthcare aims to be among the top 3 integrated healthcare providers in India, Dr Moopen said.

The company also plans to boost its India presence by adding 1500 beds in the next 2-3 years to take the total bed capacity to more than 6000 beds. At present, Aster operates in five states with a network comprising 19 hospitals, 13 clinics, 226 pharmacies, and 251 patient experience centres.