Local health insurer Acıbadem Sigorta attracts global firms

ISTANBUL - Reuters

Three global firms are in the race to buy a stake in leading Turkish health insurer Acıbadem Sigorta, sources familiar with the matter said, underscoring appetite among international investors for the fast-growing sector.

Sompo Japan Insurance, Malaysia’s state-run investment firm Khazanah Nasional Berhad and British medical services group Bupa are involved in an auction process for the stake, three banking sources said.

Acıbadem Sigorta is a 50-50 venture between a holding company owned by Dubai-based Abraaj Group and Mehmet Ali Aydinlar, the founder of Turkey’s Acibadem health group. It ranked third in the Turkish sector with a market share of just over 10 percent at the end of 2012.

Abraaj Group, the Middle East’s largest private equity firm, has put its 50 percent stake in Acıbadem Sigorta on the block, sources told Reuters in February.

Abraaj, Sompo, Khazanah and BUPA all declined to comment.

“(The offer) prices are very similar to each other. They are talking to all sides,” said one source close to the matter.

A second banking source said the asking price for the 50 percent stake was around $200-$300 million.

Turkey’s economy, the fastest growing in Europe in 2011, expanded by less than 3 percent last year but its relatively young and growing population of 75 million is regarded as under-insured.

Health insurance premiums were up 7.7 percent at 678 million lira ($350 million) in the first two months of 2013. Acıbadem Sigorta’s premium income grew 22 percent to 150 million lira in the same period, making it the largest gainer in health premiums, according to the Insurance Association of Turkey.

Last year, health insurance premiums grew 12 percent to 2.24 billion lira and Acıbadem Sigorta’s premium income jumped 36 percent to 230.3 million lira.

Allianz, Europe’s biggest insurer, bought rival Turkish insurer Yapi Kredi Sigorta from Turkish lender Yapi Kredi Bank in March for 1.6 billion lira to secure a bigger slice of a fast-expanding market.

Just over a year ago, Abraaj, which manages around $7.5 billion in assets, sold its stake in Turkey’s largest hospital chain, Acibadem Saglik, to Integrated Healthcare Holdings, a unit of Malaysian state investment arm Khazanah Nasional.