Dubai’s DM Healthcare eyes 2014-2015 IPO

Private healthcare firm will seek to list in London, UAE or India - chairman

Dr Azad Moopen, DM Healthcare chairman.

Dr Azad Moopen, DM Healthcare chairman.

DM Healthcare, one of the biggest private healthcare providers in the Gulf, is looking at an initial public offering (IPO) in the next “two or three years”, the company’s chairman told Arabian Business.

The Dubai-based firm, which operates hospitals and clinics across the GCC and in southern India, will seek to list shares on the London Stock Exchange, a bourse in the UAE or one in Mumbai, Dr Azad Moopen said in an interview.

“In the next two or three years we’re looking at an IPO, either in markets like London or maybe here (the UAE) if the market improves... or maybe in India where the multiples are very good actually,” he said.

“We can do it in London, India or the Middle East depending on the market situation,” Moopen added. 

DM Healthcare, which recently received US$100m investment from private equity firm Olympus Capital Asia, is anticipating revenues of about US$500m this financial year, Moopen said, representing 30 percent to 40 percent year-on-year growth.

Moopen said the firm was seeking perhaps one more round of external capital. “As a family we hold a significant majority [in DM Healthcare], so we can go for maybe another round of dilution without going into a minority,” he said. “Until we have an IPO I would like my family to have a majority stake.”

DM Healthcare recently announced a US$300m expansion drive across the GCC and has allocated a similar amount for investment in hospitals in India.

New projects include a 100-bed multispecialty hospital in both Dubai and Sharjah in the UAE, which are due for completion in 2013 and 2014, respectively. Other investments include two greenfield sites and three acquisitions in Saudi Arabia over the next five years and a 75-bed facility in Qatar due to open in 2014. DM Healthcare will also add 100 beds to its existing 240-bed general hospital in Riyadh.

DM Healthcare is also planning a number of new locations in India over the next five years, Moopen said, following the construction of a 3,100-bed medical city in Kerala.

“We are looking at India as a major opportunity as we go forward in the next 15-20 years,” he said. "Of course the Middle East is good and we already have a presence here, but as a larger market we would like to have a closer involvement in India.”

Moopen said that DM Healthcare was in talks to purchase stakes in existing healthcare facilities in “tier two” Indian cities in the states of Gujarat and Madhya Pradesh. These cities include Pune, Kolhapur, Nashik and Baroda.

“Our strategy is to go into these cities rather than into the metros (metropolitan areas), which already have the presence of large chains,” he added.

“Our plan is to have associations with existing doctor groups, who already own hospitals and who want to expand,” Moopen added. “For example somebody who has a 50-bed hospital or a 100-bed hospital, if they want to add on another 200 beds, and if they are ready to give a majority stake to us, then we invest the money as well as the expertise, but they will be running it from the grass roots level.”

Moopen told Arabian Business that the company would hire 10,000 new employees over the next five years, taking DM Healthcare’s total headcount to more than 15,000.

He said that DM Healthcare was also examining potential opportunities in the US, Europe, Egypt and Nigeria, which would mainly target medical tourism, but would likely not happen until after 2017. “Instead of [patients] travelling to the Asian countries, why don’t we take this to them? It will be a better method than bring all these patients here,” Moopen said. “If you take one doctor [to the US], maybe he can see 100 patients there?”

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