Investcorp Said in Talks for Stake in Saudi Health-Care Company

Bahrain-based private equity firm Investcorp Bank BSC is in exclusive talks to buy a minority stake in Saudi Arabia-based health-care company Al Borg Medical Laboratories, according to people with knowledge of the matter.

The deal could value the company at more than 1 billion riyals ($270 million), the people said, asking not to be identified as the information is private. Ernst & Young is advising Al Borg on the sale, they said.

The Bahrain-based money manager, the Gulf’s largest private investor in U.S. real estate, said in July that Abu Dhabi sovereign investment fund Mubadala Development Co. will acquire a 20 percent stake. Al Borg is the Middle East’s largest chain of private medical laboratories, providing medical tests for individuals and health-care companies, according to its website.

Private investment in Saudi Arabia’s health-care industry is picking up as the government embarks on an economic transformation plan that aims to boost the contribution of private sector spending to 35 percent from 25 percent. Abu Dhabi-based NMC Health Plc has invested $32 million in the kingdom’s healthcare sector, deputy chief executive officer Prasanth Manghat said in an interview with Bloomberg Markets Middle East on Monday.

A spokesman for Investcorp declined to comment, while Ernst & Young and Al Borg didn’t respond to requests to comment.

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