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Mediclinic to join hands with Al Noor

|By TAP Staff| Mediclinic International Ltd. is in talks with United Arab Emirates health-care provider Al Noor Hospitals Group Plc about a tie-up that would create the biggest supplier of private care in Dubai and Abu Dhabi with further operations in Europe and Southern Africa.

The potential deal between the two hospital owners would involve the issue of new Al Noor shares to Stellenbosch, South Africa-based Mediclinic and be classified as a reverse takeover, Abu Dhabi-based Al Noor said in a statement on Monday. “There can be no certainty at this stage that the discussions between the company and Mediclinic will lead to any agreement,” it said.

Mediclinic is seeking to expand in countries where rising household incomes have led to growing demand for private health care. A combination with Al Noor would boost its operations in the United Arab Emirates, while it also owns hospitals in Southern Africa and Switzerland. The company, South Africa’s largest private hospital operator, entered the U.K. earlier this year after agreeing to buy a stake in Spire Healthcare Group Plc for 431.7 million pounds ($655 million).

 “Abu Dhabi has been on Mediclinic’s radar for some time,” Andre Bekker, an analyst at Avior Capital Markets in Johannesburg, said by phone. “Al Noor is a good fit both from a geographic footprint and because of the specialized services they offer.”

Mediclinic shares gained 3.3 percent to 117 rand by the close in Johannesburg, the highest since May 20, giving it a market value of about 115 billion rand ($8.4 billion). The company said in an earlier statement it’s in talks that could affect the share price, and didn’t respond to a phone call and e-mail seeking further comment. Al Noor gained 7.6 percent to 919 pence at the close in London, valuing the company at 1.1 billion pounds.

“If implemented, the potential combination would create a market leader across both Dubai and Abu Dhabi,” Al Noor said. The company would have “deep operational expertise and a well-balanced geographic profile.”