Apax cashes in on Capio property

An Apax-led consortium has completed the £700 million sale and leaseback of 21 hospitals owned by Capio, the Swedish healthcare provider it bought last year, in the latest example of private equity groups cashing in on property assets.

The private equity owners of Capio, a Swedish healthcare provider, have sold 21 of the group’s hospital properties to UK financial services company Prestbury for £686 million (€1 billion, $1.4 billion).

Capio is owned by a consortium comprising Apax Partners, Nordic Capital and Apax France, which bought the group last year for €2.8 billion ($3.8 billion).

The properties will be rented back to the group on 30-year leases for £39.5 million a year.

Apax director Khawar Mann said the sale and leaseback of the UK hospitals was “a key part of our strategy in acquiring Capio last year”.

Prestbury has previously worked on a number of other sale and leaseback deals, buying 220 pubs from Spirit Group (now Punch Taverns) for £500 million and also acquiring Bank of Scotland’s London headquarters for £140 million. Chairman Nick Leslau said his firm had “considerable appetite and resources to do much more in the sale and leaseback arena.”

Property assets are becoming an increasingly significant part of large buyout deals.

The CVC-led consortium that made an abortive £10 billion bid for Sainsbury’s, a UK supermarket chain, was driven partly by the company’s extensive property portfolio, which had an estimated value of about £7.5 billion – although according to media reports the company is set to reveal this week that its true value is nearer £10 billion.

Property entrepreneur Robert Tchenguiz, one of Sainsbury’s largest shareholders, is reportedly now pressuring the board to realise more value from this portfolio.