IHH may buy more hospitals after IPO (5225)

IHH Healthcare Bhd, the world's second-biggest health-care provider by market value, may buy more hospitals in markets that have unmet demand, Managing Director Lim Cheok Peng said.

IHH's stock surged on debut today after it raised RM6.3 billion selling shares in a Kuala Lumpur and Singapore initial public offering, the world's third-largest this year. Lim said IHH may consider smaller acquisitions to add to its January purchase of a 60 per cent stake in the owner of Turkey's largest hospital group, Acibadem Saglik Hizmetleri and Ticaret AS, which it bought for US$826 million in cash and stock.

"I don't think we are prepared to do another major acquisition like Acibadem, but if opportunities arise that fit the overall game plan, we could certainly look at it," Lim said in a telephone interview.

Kuala Lumpur-based IHH, whose IPO was 132 times subscribed by institutions, already plans to add 67 per cent more hospital beds by 2017 to capitalize on populations that are becoming richer and demanding better care. Increasing medical tourism and private health insurance coverage will drive steady demand for beds and services, said B. Kemp Dolliver, head of Asia health- care research at Religare Capital Markets Plc.

"It's going to be a stable business in an unstable world," Dolliver, who is based in Singapore, said in a telephone interview. "There's rising affluence in Asia and aging populations, so the demand dynamics look very promising."

IHH rose by 10 per cent to RM3.09 at the 5 p.m. close of trading in Kuala Lumpur. In Singapore, the stock closed 10 per cent higher at S$1.23. -- Bloomberg