BTG Pactual to sell stake in Brazil hospital chain to GIC

BRASILIA • Investment bank Grupo BTG Pactual will sell a stake in Brazil's largest hospital chain, Rede D'Or Sao Luiz SA, to GIC for about 2.38 billion reais (S$865 million), the bank said yesterday.

The operation will be subject to antitrust regulatory approval, BTG Pactual said in a statement.

It did not specify the size of the stake being sold, but sources with direct knowledge of the deal told Reuters on Sunday that it would be about 12 per cent of the hospital chain.

The move comes as Latin America's largest independent investment bank strives to shore up its cash levels following the arrest on Nov 25 of its founder and largest shareholder, Andre Esteves, in a corruption scandal.

Esteves was arrested as part of "Operation Car Wash", a probe into links between ruling coalition politicians and company executives who allegedly traded contracts at state firms for bribes and campaign donations.

Executives at the Sao Paulo-based bank had been negotiating exiting Rede D'Or since August but Esteves' detention sped up talks.

People familiar with the matter said last week the bank was trying to sell its remaining stake in Rede D'Or.

BTG Pactual bought 25.6 per cent of Sao Paulo-based Rede D'Or in 2010 for about 600 million reais, a person familiar with the matter said earlier this year.

In May, BTG Pactual sold half of its holding in Rede D'Or to GIC for 1.6 billion reais, according to the bank. In August, BTG Pactual was in talks to sell a small stake to Carlyle Group, the Washington-based private-equity firm, people familiar said at the time.

Meanwhile, GIC and CVC Capital Partners have agreed to buy Carlyle's stake in British roadside assistance company RAC.

CVC and GIC plan to invest in RAC's technology, data and telematics platform and see a "significant long-term growth opportunity", according to an e-mailed statement yesterday.

The agreement involves purchase of close to 50 per cent of RAC from Carlyle, which bought the company from Aviva in 2011, Sky reported, citing people familiar with the matter.

Last year, GIC bought an undisclosed stake in RAC. The deal resulted in GIC and Carlyle jointly owning a majority stake in RAC, with the company's management holding the rest.

Representatives at CVC, Carlyle and RAC were not immediately available for comment.


A version of this article appeared in the print edition of The Straits Times on December 03, 2015, with the headline 'BTG Pactual to sell stake in Brazil hospital chain to GIC'. Subscribe