BMI Healthcare: successful recapitalisation

14 December 2018

BMI Healthcare Limited (“BMI Healthcare”) is one of the largest private hospital groups in the UK with 59 hospitals and clinics across the country, working with more than 6,000 consultants and employing over 8,000 staff. The hospital group has a national footprint and offers a full breadth of specialities and services.

The Company was founded in 1970 and Netcare, the South African healthcare group, acquired a controlling stake in what was the General Healthcare Group in 2006. Following the acquisition, the group was split into an “Opco” and “Propco” structure, with the Opco becoming BMI Healthcare. Above market fixed annual rent increases, coupled with changes to the market which have seen a contraction in the private medical insurance market and a reduction in NHS referrals, resulted in decreasing profits at BMI Healthcare.

On 14 December 2018, BMI Healthcare successfully concluded a transaction which saw a capital injection into BMI Healthcare of approximately £60m, a reduction in its annual rent of £65m, refinance of its £115m of banking facilities until 2023, transfer of ownership to Hospital Topco Limited and the extinguishment of various liabilities in excess of £600m. These contributions will fund a £250m capital investment programme which is already underway and will accelerate the reconfiguration and refurbishment of BMI Healthcare’s extensive estate and underpin the continued delivery of excellent patient care.

As a result of the successful conclusion of this transaction, Michael O’Donnell has stepped down as a non-executive director of certain BMI Healthcare companies and from the restructuring committee, where he has served since January 2018.