In a strategic move to enhance shareholder value and streamline its operations, Aster DM Healthcare, one of the largest integrated healthcare providers in the GCC and India, has announced the separation of its India and GCC businesses. The decision, subject to regulatory and corporate approvals, aims to foster market-focused strategies and ensure sustained long-term growth for both entities.
Fajr Capital-Led Consortium to Invest ₹356.78 Crores in Aster’s GCC Business
The board’s approval includes a definitive agreement with a consortium led by Fajr Capital for the investment in Aster’s GCC business. Under this agreement, the consortium, including Emirates Investment Authority, Al Dhow Holding Company, Hana Investment Company, and Wafra International Investment Company, will acquire a 65% stake in the ownership of Aster DM Healthcare FZC. The Moopen family, founders of Aster, will retain a 35% stake, ensuring continuity in the management and operation of the GCC business.
The transaction values the GCC business at an enterprise value of US$1.7 billion (₹13,540 crores) and an equity value of US$1.0 billion (₹8,215 crores). The separation plan aims to unlock the combined market cap of approximately USD $2.0 billion for both the India and GCC businesses.
Strategic Leadership Changes and Growth Plans
Following the completion of the separation, Dr. Azad Moopen, Founder & Chairman of Aster DM Healthcare, will continue overseeing both India and GCC entities. Ms. Alisha Moopen will be promoted to the position of Managing Director and Group CEO of the GCC business. Dr. Nitish Shetty will remain the CEO of the Aster business in India.
The separation aligns with the distinctive growth dynamics of the GCC and India healthcare markets, allowing each entity to tailor its business strategy to the unique demands of its region. In India, Aster plans to increase bed capacity by over one-third, adding more than 1500 beds by FY27. In the GCC, Aster DM Healthcare FZC aims to expand its presence in key markets such as the UAE and Saudi Arabia.
Expert Insights and Advisory
EY and PwC provided independent valuation advice, while ICICI Securities offered a fairness opinion for the valuation guidance. Baker & McKenzie LLP and Cyril Amarchand Mangaldas served as legal advisors for Affinity and Aster, respectively. Moelis & Company and Credit Suisse acted as sell-side advisors, and HSBC Bank Middle East Ltd., Allen & Overy LLP, and PwC acted on behalf of the Fajr Capital consortium.
Leadership Vision and Future Outlook
Dr. Azad Moopen, Founder and Chairman of Aster DM Healthcare, highlighted the rationale behind the strategic decision, emphasizing the goal of establishing fair value for both entities. He expressed confidence in Fajr Capital’s expertise, envisioning a future where Aster’s GCC business continues to deliver best-in-class healthcare services underpinned by Fajr Capital’s strong market presence and network.
The separation marks a pivotal moment for Aster DM Healthcare, positioning the company for focused growth in both the GCC and India markets. As the healthcare landscape continues to evolve, Aster remains committed to providing high-quality services and creating long-term value for its shareholders.