Kenya – US-based company in talks to take over Abraaj health fund

 In news

An American private equity fund, TPG Capital, plans to buy the entire stake of cash-strapped Abraaj Holdings in Kenya’s 10 private hospitals and their 18 affiliate clinics.

Media reports in Wall Street Journal and Financial Times cited consulting firm AlixPartners as confirming receipt of a letter on the deal between TPG and liquidators allowing the US investment firm to become a manager and partner in management of Abraaj Growth Markets Health Fund (AGHF)’s kitty worth about Sh103 billion.

Abraaj Growth Markets Health Fund, whose investors include the Bill and Melinda Gates Foundation, was used to finance purchase of healthcare projects in Kenya, Pakistan and Nigeria.

The fund had signalled plans last year to add more Kenyan hospitals to its portfolio.

“Right now we have invested in Nairobi Women Hospital, Avenue Hospital, Metropolitan Hospital and Ladnan Hospital.

“We are also interested in diagnostics and are seeking opportunities to invest in lab and imaging businesses in this area,” said Fredd Kambo, a director in the healthcare team at the Abraaj Group with responsibility for East Africa.

If successful, TPG’s Rise Fund, described as the world’s biggest impact investing fund with Sh210 billion assets under management, will help oversee operations at the Kenya-based hospitals.

The Financial Times quoted sources at AlixPartners as saying TPG had agreed with AGHF investors on the modalities of the planned takeover that will further slice Abraaj’s equity empire in Africa worth an estimated Sh320 billion.

“We are excited to build on the important work commenced by Evercare (the healthcare fund’s platform) to build an integrated healthcare delivery network in growth markets across Africa and South Asia that will help communities thrive,” said TPG chief executive Bill McGlashan.

The ongoing talks were brought on by Abraaj’s self-liquidation before the High Court in Caymans Island last June to fend off creditors’ bid to seize their assets over delay in payment of mature funds.

Twenty-four AGHF investors moved in saying their Sh103 billlion kitty was protected from seizure since their plans were to invest in healthcare projects.

According to the media reports, TPG promised to maintain AGHF’s investors’ vision of a vibrant but affordable privately run healthcare in the identified markets. Source: Business Daily 

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