KUALA LUMPUR – Sime Darby Bhd is exiting the healthcare business by selling its entire 50% equity interest in Ramsay Sime Darby Health Care Sdn Bhd (RSDH) to Columbia Asia Healthcare Sdn Bhd for RM2.84 billion.
It said wholly owned subsidiary Sime Darby Holdings Bhd (SDHB) and Ramsay Health Care Ltd’s subsidiary AH Holdings Health Care Pty Ltd, which owns the remaining 50% of RSDH, today inked an agreement with Columbia Asia to dispose of their combined 100% interest in RSDH for RM5.68 billion.
In a filing with Bursa Malaysia, Sime Darby said the deal would enable the group to unlock the value of its healthcare assets, which have previously been deemed non-core, with a RM2 billion gain on disposal.
“The proceeds from the proposed disposal will enable Sime Darby and its subsidiaries to further strengthen its core businesses of industrial and motors by paring down its borrowings arising from the acquisition of UMW Holdings Bhd,” it said.
This, Sime Darby noted, would lower its gearing and provide further balance sheet headroom to the group.
RSDH operates four hospitals in Malaysia and three hospitals in Indonesia.
Columbia Asia is a Malaysia-based international private healthcare company and a wholly owned subsidiary of Columbia Asia Healthcare Pte Ltd – which is itself 99.9% owned by HLT Healthcare Holdings Ltd, which in turn is jointly owned by Malaysian conglomerate, the Hong Leong Group, and One Health Holdings, which is owned and controlled by TPG-managed funds.
In a statement, Sime Darby group chief executive Datuk Jeffri Salim Davidson said while the hospital business is a great asset, the group has always maintained its focus on its core trading businesses of motors and industrial.
“The offer from Columbia Asia was one we could not refuse,” he said.
Meanwhile, Columbia Asia director Tunku Ali Redhauddin Tuanku Muhriz said RSDH has a unique platform of hospitals with a long history of excellent patient care for the communities that it serves in Malaysia and Indonesia.
“This will greatly complement Columbia Asia, and we look forward to working with the doctors, nurses and other colleagues from both RSDH and Columbia Asia to continue contributing to healthcare ecosystems in Malaysia, Indonesia and Vietnam,” he said.
On the proceeds, Sime Darby said it would be utilised to repay the borrowings for the acquisition of UMW Holdings Bhd and/or to fund the cash outlay for the mandatory general offer of the acquisition.
The group expects the proposed disposal to be completed in the third quarter of the financial year ending June 30, 2024. – November 10, 2023