Doughty Hanson has agreed to buy 40 per cent of Grupo Hospitalario Quirón, a Spanish hospital operator that the London-based private equity firm plans to merge with its recently acquired stake in USP Hospitales to create one of Spain’s largest private hospital groups.
Although financial terms of the deal were not disclosed, the 950 bed group was valued using a similar multiple to USP Hospitales, the 1,200 bed company the firm bought in February for €355m – equivalent to a nine times multiple of this year’s EBITDA forecast from Barclays and Royal Bank of Scotland.
Under the terms of the transaction, Grupo Hospitalario Quirón’s majority owners, the Cordón Muro family, will become joint owners of the new entity with Doughty Hanson. Reports suggest the buyout firm will retail around 65 per cent of the combined entity.
Grupo Hospitalario Quirón owns eight hospitals spread across Spain and three IVF clinics.
USP Hospitales is the third largest private hospital operator in Spain, with a market share of 5.5 per cent in 2010, and is focused on the provision of hospital services to the private insurance and self-pay segments. It operates 12 hospitals, one specialist clinic and 22 auxiliary clinics.
Doughty Hanson developed expertise in the private healthcare sector following its investment in Priory in 2002. At the time of the acquisition, it was the largest independent provider of mental health and rehabilitation services in the UK.
Under the firm’s ownership it had a national presence with over 42 locations, over 2,000 beds and nearly 4,500 staff. Priory was sold in July 2005 in a transaction valued at £875m and delivered a 3.9 times return on capital invested.
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