China-focused investment firm New Frontier Corporation (NFC) agreed to acquire domestic private healthcare provider United Family Healthcare (UFH) from its existing shareholders including Fosun Pharma for US$1.3 billion.
According to an NFC statement, UFH will operate under the name of New Frontier Health Corporation, and become one of the largest publicly listed integrated healthcare services companies in China after the transaction.
Paul Hastings partner Yan Jia, who advised the selling shareholder Fosun Pharma, said the deal involved the complexity of dealing with expertise across various practices such as M&A and US securities law. He was also optimistic about the future prospect of China’s private healthcare market.
“In the face of an accelerating ageing population and burgeoning healthcare spending by the Chinese government, we can expect huge growth in China’s private healthcare market with immense opportunities particularly for M&A and investment,” Yan told Asia Business Law Journal.
He added that the potential growth momentum may also drive relevant subsectors, such as senior housing and insurance brokerage relating to private healthcare, to develop quickly.
The transaction also involved global alternative asset firm TPG selling its stake in UFH to NFC. Existing management of UFH and Fosun Pharma together are expected to own an aggregate of approximately 12% of NFH at closing.
NFC is a public investment vehicle sponsored by New Frontier Group. Winston & Strawn, Simpson Thacher & Bartlett, Kirkland & Ellis, and Global Law Office acted as legal advisers to NFC.