Saudi Arabia: Bupa proposes to increase its stake in Bupa Arabia
Source: Middle East Insurance Review | Jul 2020
International health insurer Bupa proposes to increase its stake in Bupa Arabia by 4% to 43.25%, following an agreement to acquire a portion of Nazer Group’s stake in Bupa Arabia.
Bupa is submitting formal applications to the relevant Saudi Arabian authorities for the customary regulatory approvals, the company said in a statement.
The agreed price of SAR105 ($28) per share values the deal at SAR504m, reflecting the continuing long-term growth prospects of Bupa Arabia.
Together, Bupa and the Nazer Group will continue to hold over 50% of the shares in Bupa Arabia, although they continue to act independently of each other. The remainder of the shares in Bupa Arabia are publicly traded.
Bupa and Nazer Group first formed a partnership in 1997 and Bupa Arabia was established in 2008. Bupa Arabia has since grown to become the leading health insurance provider in Saudi Arabia.
Bupa has been incrementally increasing its shareholding over recent years with similar investments made in 2017 and 2018. Bupa last raised its stake in the Saudi venture in August 2018 when it completed its agreement to buy a 5% stake in Bupa Arabia at SAR100 per share from Nazer Group. That purchase increased Bupa’s stake to 39.25% in the venture.
Saudi Arabia is a market with rising customer demand for high quality healthcare funded by private health insurance, and Bupa has incrementally increased its shareholding of this successful business over recent years. The increase in Bupa’s shareholding is in line with its strategy of investing to strengthen its existing market positions to deliver sustainable growth. M
SAR1 = $0.27