(Reuters) – Australia’s HealthCo Healthcare and Wellness REIT said on Friday that a consortium led by David Di Pilla’s HMC Capital had approached it for a possible buyout of Healthscope hospitals.
Healthscope, which is the country’s second-largest private hospital operator with about 38 hospitals, accounts for nearly 59% of HealthCo’s gross earnings and has a market value of A$1.5 billion, the real estate investment trust said in a statement, without giving any further details.
HealthCo is majority owned by Di Pilla with a more than 22% stake, as per LSEG data.
HealthCo forked out A$1.20 billion ($757.68 million) in 2023 to acquire Medical Properties’ Healthscope hospital portfolio, a chain of 11 private hospitals in a deal that was backed by asset manager HMC Capital.
Earlier, New York-headquartered private equity firm Brookfield acquired Healthscope in 2019 only for them to sell some of Healthscope’s hospitals to Medical Properties.
HealthCo said on Friday it had been approached by “capable and qualified parties to potentially tenant the 11 hospitals including a consortium led by HMC Capital’s private equity division.”
Shares of HealthCo, which have fallen about 12% since their debut in 2021, gave up early gains to close flat.
HMC Capital’s managing director for real estate, Sid Sharma, said, “The pressures around private health insurance and wage costs are well documented… VMO (visiting medical officer) retention is high. What needs to be rectified… is the capital structure.”
Asset manager HMC launched Australia’s largest initial public offering of last year through DigiCo REIT, a new digital infrastructure real estate trust focused on data centers.
HealthCo logged a 5% growth in funds from operations (FFO) to 4.2 Australian cents per share in the first half of the year and reaffirmed its full-year FFO forecast of 8.4 cents apiece.
($1 = 1.5838 Australian dollars)
(Reporting by Rajasik Mukherjee in Bengaluru; Editing by Subhranshu Sahu)
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