July 30, 2019 / 4:15 PM / 4 months ago

Bridgepoint tests appetite for $2.2 billion dialysis clinic firm Diaverum: sources

FRANKFURT/LONDON (Reuters) - European buyout firm Bridgepoint is exploring a sale or stock market listing of its dialysis clinic operator Diaverum as part of a long-anticipated exit plan that could fetch up to 2 billion euros ($2.23 billion), sources close to the matter told Reuters.

The London-based buyout group has hired JP Morgan and SEB to prepare the company for a sale or listing, with a view to starting a formal dual-track process early next year, the sources said.

But the banks will start sounding out prospective bidders after the summer break, they said, as part of their pre-marketing work to establish if there is sufficient interest to launch a process.

Bridgepoint declined to comment.

Representatives at JPMorgan and SEB were not immediately available for comment.

Based in the Swedish city of Malmo, Diaverum ranks as Europe’s largest independent dialysis clinic operator, with ancillary businesses in South America and Australia.

Earlier this year it signed a new five-year dialysis contract with the Ministry of Health in Saudi Arabia, which the company hopes will boost its business.

Bridgepoint has held the company for more than a decade, having bought it in 2007 from EQT.

Diaverum, which serves more than 36,000 patients with a headcount of 11,000 people, could be valued at 12-13 times its expected core earnings of 150 million euros, giving it a valuation of almost 2 billion euros, the sources said.

The company’s hospital network of 380 clinics in 19 countries may appeal to other private equity firms such as Advent, Bain, BC Partners, KKR and Nordic Capital, the sources said.

Industry peers such as Germany’s Fresenius Medical Care (FMEG.DE) and U.S.-based Davita (DVA.N) are unlikely to bid due to antitrust concerns, while the likes of B.Braun could find its valuation challenging, the sources said.

Under Bridgepoint’s ownership, Diaverum has ramped up its global presence through a string of acquisitions giving it a strong Middle East and China presence.

The private equity firm has frequently explored strategic options in the past. Most recently it opted to refinance the business in 2017 after weighing a possible sale, the sources said.

Editing by Jan Harvey

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