Private hospital chain Spire Healthcare made its market debut yesterday after pricing its shares at the bottom of its expected range.
The group has 39 hospitals across the UK, including the Spire Murrayfield in Edinburgh, and has raised about £315 million to reduce its debts and fund its growth ambitions.
Shares in the company launched at 210p, right at the bottom end of the 210p to 300p range it set at the start of last week. The float valued the firm at about £842.3 million.
Chief executive Rob Roger said: “We are pleased that investors, staff and consultants have recognised the multiple growth opportunities offered by Spire’s 39 hospitals and 13 clinics.
“Our excellent track record of clinical outcomes and operating efficiency means we believe we will benefit from the positive UK healthcare market dynamics of a growing population, longer life expectancy and increasing patient choice.”
Private equity firm Cinven created Spire through the purchase of 25 hospitals from private healthcare group Bupa in 2007. Since then, £509m has been invested in the business, which now employs almost 7,000 people. Shares worth £4.2m have been allocated to consultants and staff.
Spire is now the UK’s only private hospital operator listed on the London Stock Exchange and generates more than half of its revenues through private medical insurance (PMI) providers. A quarter of its sales come from the NHS.
The UK private hospital market is said to be worth about £4.6 billion and was the subject of a lengthy probe by competition authorities which argued that patients were paying too much for their PMI. Spire’s rival HCA was ordered to sell one or more of its hospitals in London after the Competition & Markets Authority found it had too strong a grip on the market for both self-paying and insured patients.
Roger said the flotation of Spire was a “milestone” for the London-based group, which delivered an underlying pre-tax profit of £154.1m last year.