Supported by the Bill & Melinda Gates Foundation and the International Finance Corporation (IFC), a United States-based private equity firm is selling its investment in Nairobi’s Metropolitan and Ladnan hospitals in a worth Sh1 billion deal.
Metropolitan Group Holdings, the holding company that owns the two hospitals, is sold by Evercare Health Fund for USD 54.9 million to minority co-owner Metro Group Plc, which currently holds a 41.8% stake in the business.
The combined annual revenue of the two hospitals was over Sh1 billion, according to the Competition Authority of Kenya (CAK) data.
The 134 beds at Metropolitan Hospital and the 42 at Ladnan provide the two facilities with 5.8% of the 3,000 private hospital beds in Nairobi County.
The Gates Foundation, TPG Rise Fund, IFC, British development fund BII (formerly CDC), US development fund DFC, Philips, and Medtronic are among the investors in the Texas Pacific Group (TPG), which manages the fund.
It runs healthcare institutions in developing nations throughout South Asia and Africa.
Once the deal is done, the organization that founded Metropolitan Hospital 27 years ago will again hold the majority of the hospital’s stock.
In 1995, Metro Group, then doing business as Metropolitan Health Services (MHS), opened a hospital in Nairobi’s Buru Buru Estate. Later, the company sold some of its shares to the general public, bringing the total number of shareholders to over 500.
Abraaj Holdings was initially invited in by the group, led by Dr Kanyenje Gakombe and Dr Robin Michira, as an outside investor in the hospital.
After that, Metro mainly focused on financial assets and commercial real estate, with an asset base worth more than Sh560 million.
Bill Gates-backed Evercare became a shareholder in Metropolitan Group Holdings in 2019 following the collapse of Abraaj, once the largest buyout fund in the Middle East and North Africa, due to a dispute with investors over the use of funds in its healthcare fund. The Dubai-based company then filed for provisional liquidation in 2018.