Healthcare Provider Fakeeh Care Considers an IPO and Appoints HSBC, According to Sources

One of the biggest private hospital companies in Saudi Arabia, Fakeeh Care, is thinking of selling a 30% stake through an IPO, according to two sources familiar with the situation who spoke to Reuters.

The family-owned company, which has hospitals in Jeddah and Riyadh, has hired HSBC to provide advice on the transaction, according to the sources, who declined to be named because the information is private.

When contacted by Reuters on Sunday, Fakeeh Care did not respond to a comment request right away. HSBC chose not to comment.

The group opened its first hospital, named after its late founder Dr. Soliman Fakeeh, in 1978.

The company has a total bed capacity of over 1,400 with over 1,000 doctors and 2,000 nurses, according to its website.

Riyadh has been encouraging more family-owned companies to list in a bid to deepen its capital markets as part of reforms aimed at reducing the country’s reliance on oil revenue.

Saudi Exchange, the largest and most liquid stock market in the Arab world, has seen a surge of listings from the healthcare sector in the last three years, including hospitals group Dr Sulaiman Al Habib, pharmaceutical group Al Nahdi Medical Co, and generic drugmaker Jamjoom Pharmaceuticals Factory Co.

Saudi Arabia has allocated 189 billion riyals ($50.4 billion) in its 2023 budget to health and social development, a joint second alongside education as the biggest expenditure for the country following the military.

Companies in the Middle East have raised $5.3 billion in the first half of this year, the most in 15 years with the exception last year, according to Refinitiv data, which was a standout year for IPOs. ($1 = 3.7512 riyals)