Primary Health Properties has agreed to a joint venture with Singapore’s GIC to invest in private hospitals, raising around £500m to cut its debt.
The healthcare property group said it would put 27 private hospitals, worth about £700m, into a 50:50 venture with the sovereign wealth fund, retaining a half share and acting as the portfolio’s manager.
The deal is expected to complete in November.
PHP said it would use the proceeds to reduce borrowings, including the remaining bridging loan it took on to acquire rival Assura last year. The transaction will cut net debt to around £2.9bn and lower the loan-to-value ratio, while bringing in a major institutional partner and a new stream of management-fee income.
Chief executive Mark Davies called the venture an important strategic milestone, saying it reduced debt, improved shareholder returns and positioned the company to grow in the private healthcare market.