NMC EYEING SAUDI EXPANSION?

London-listed firm talking to Riyadh government on running Saad Specialist centre in Khobar, say sources

LONDON-LISTED NMC Healthcare is in talks with the Riyadh government to take over the running of a struggling Saudi hospital, according to four sources familiar with the matter.

A deal for the Saad Specialist Hospital in Khobar, one of the top cancer treatment facilities in the Gulf, would be a rare instance of a foreign group operating a Saudi hospital.

It would be a test of Riyadh’s plan to bring overseas investors into the healthcare sector under a reform drive, led by Crown Prince Mohammed Salman, aimed at restructuring the kingdom’s economy.

The Saudi health ministry has asked interested parties to submit bids for the operational licence by the end of this month, said the sources. United Arab Emirates-based NMC is involved in the process and is considered a frontrunner to win the contract, they added.

The hospital is owned by Saad Group, a conglomerate owned by billionaire Maan al-Sanea, which also operated the facility.

But in recent weeks, the government has stepped in after the hospital become weighed down by financial problems, said the sources.

The hospital had effectively ceased operating due to debts, which meant it was unable to pay salaries or contractors, according to the sources.

The government’s intervention coincided with the detention of al-Sanea by Saudi authorities for unpaid debts.

Saad Specialist is one of only two hospitals in the kingdom to have a cyclotron, used to help identify cancerous tumours. The ministry is keen to get it reopened as quickly as possible.

It approached NMC and other healthcare companies a few weeks ago about taking over the running of the facility and conducted a site tour for potential bidders, which number around 10, according to the sources. The sources did not name any other potential bidders.

Saad Specialist Hospital, which al-Sanea opened in 2001, gradually ground to a halt this year as staff began to leave, including doctors and nurses, because of non-payment of salaries, which in some cases dated back around one year, said the sources.

In addition, contractors began to stop maintaining the high-tech medical equipment because of lack of payment.

At the peak of his business success in 2007, al-Sanea was ranked by Forbes as one of the world’s 100 richest men, with his Saad Group owning interests in everything from banking to civil engineering.

But his empire has been embroiled in a high-profile debt dispute since 2009 spanning courts in London to the Cayman Islands, and Saudi authorities have recently begun liquidating some of his assets.

al-Sanea was detained in October in the kingdom’s Eastern Province and he has been held in a civil detention centre in Khobar, said sources. Reuters