UPDATE 2-UAE-based NMC Health plans London IPO

Thu Mar 8, 2012 2:05pm GMT

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(Recasts, adds details from official, sources)

* NMC to offer 30 pct of capital - official

* London IPO to price end March or early April - source

* Issue may include 15 pct greenshoe option

* IPO proceeds to be used for expansion

By Stanley Carvalho and David French

ABU DHABI/DUBAI, March 8 (Reuters) - UAE healthcare provider NMC Health, founded by billionaire Indian entrepreneur B.R. Shetty, plans to raise up to $250 million by offering an additional 30 percent of its capital in an initial public offering on the London Stock Exchange.

Abu Dhabi-based NMC, one of the largest private sector healthcare providers in the United Arab Emirates, operates general and specialialised hospitals, pharmacies and medical centres.

NMC said it will use proceeds from the IPO and a $150 million credit facility to finance expansion plans.

These include the acquisition of a medical centre in Dubai by July, the development of a maternity hospital in Abu Dhabi scheduled to open by the second half of 2012. It also plans to construct a hospital in Abu Dhabi by 2014.

"This will allow the company to develop existing and new facilities, as well as expand into new high-growth markets," Shetty said, adding London was chosen for the IPO because of its deep pool of capital and global profile.

Yet, Europe's IPO market has come to a near standstill over the last year, hard hit by the prolonged euro zone debt crisis. The last completed IPO on London's main market was that of Russian oil producer RusPetro in January.

IPOs by companies in the Gulf Arab region came to a halt after the 2008 financial crisis amid slumping markets and lack of investor appetite.

NMC expects to price the IPO by the end of March or early April, a banking source working on the deal told Reuters.

The issue could involve an over-allotment, or greenshoe, option amounting to 15 percent of NMC's share capital if demand is strong, the source added, speaking on condition of anonymity.

While the shares offered in the IPO will be new shares, those in the greenshoe would come from existing share capital.

Two weeks of 'pilot fishing' -- informal meetings with investors to gauge their interest in a potential offering -- have taken place, with specialist emerging market and healthcare funds targeted, as well as UK domestic funds.

A further two weeks of roadshows are planned prior to the pricing of the transaction. The prospectus is due to be published around March 20, the source added.

Shetty, a trained pharmacist who arrived in the UAE in 1973, has sold a portion of his stakes in NMC and money exchange business, UAE Exchange over the past year.

He currently owns 30 percent in NMC, it said in statement.

Since early 2011, NMC has been controlled by investor Saeed Bin Butti, who holds a 43 percent stake. His investment firm holds a further 12 percent.

NMC, which also distributes consumer goods, educational supplies and cosmetic products, had revenue of $443.7 million and adjusted EBITDA of $70.5 million in 2011.

Deutsche Bank is acting as sole sponsor, global co-ordinator and bookrunner. Numis Securities Limited and Shuaa Capital are acting as joint lead managers.

Oil-rich Abu Dhabi is investing billions of dollars in industry, tourism, healthcare and infrastructure to diversify its economy away from oil. In recent years, Abu Dhabi has taken steps to privatise the healthcare sector bringing in international companies to manage its hospitals. (Additonal Reporting by A. Ananthalakshmi in Bangalore; Editing by Dinesh Nair and David Hulmes)

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