Healthcare provider, Spire, ponders potential sale due to mounting pressure from shareholders
Spire Healthcare Explores Potential Sale Amidst Growing Interest
In a significant development, private hospital group Spire Healthcare has announced that it is exploring potential options for the business, including a possible sale. This move comes as the company has seen a surge in demand from patients seeking alternatives to overstretched NHS services, which now account for more than 30% of Spire's revenues.
The renewed international interest in private hospital groups is noteworthy, with sector experts, such as Michelle Tempest of consultancy Candesesic, observing this trend. In the US, private providers are under pressure from Medicaid cutbacks, whereas in the UK, opportunities to expand abound.
Spire Healthcare operates 38 hospitals and more than 50 clinics across the UK. The group's market capitalization stands at £872m as of Thursday's close. Top investors, including Toscafund and Harwood Capital, have urged Spire to consider a sale at a price of at least £3.40 a share, following the company's operational turnaround.
Rothschild & Co has been appointed as lead financial adviser to support the review, which aims to enhance long-term shareholder value. Analysts suggest that the current environment has driven more patients into private healthcare, with record levels of A&E attendances and a staggering 7.4m people waiting for NHS procedures in July.
It is important to note that the review remains at an early stage, and no decisions have been made. There are no active discussions regarding a sale, and no relevant information about institutions interested in purchasing Spire Healthcare or potential buyers has been provided.
In 2021, Spire rejected a £2.50-a-share bid from Australia's Ramsay Healthcare. However, a potential deal could value the group at more than £1.4bn, according to reports. The rise in prices in NHS contracts, which increased by 3.9% in 2024, may also contribute to the potential value of the group.
As the review progresses, investors are keen to crystallize gains, with some expressing interest in the prospect of a sale. However, the future of Spire Healthcare remains uncertain, and only time will tell what decisions will be made regarding the company's future direction.
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