Saudi hospitals close to hiring Goldman on merger


LONDON • Saudi Arabian hospital operator Al Hammadi Co for development & investment is close to hiring Goldman Sachs Group Inc to advise on merger talks with National Medical Care Co, according to people with knowledge of the matter.

Al Hammadi could finalise appointing Goldman Sachs in coming days, the people said, asking not to be identified because the information is private. The mandate isn’t final and the company’s plans could change, they said. National Medical Care is likely to work with JPMorgan Chase & Co, they said.

A representative for Al Hammadi said the company will select an advisor soon, without providing any additional details. Spokesmen for Goldman Sachs and JPMorgan declined to comment.

National Medical Care didn’t respond to requests.

The two companies said in August they were in preliminary discussions about a potential merger that would create a company with a combined market value of US$1.9 billion (RM7.39 billion).

Mergers and acquisitions in Saudi Arabia are set to pick up as slower economic growth encourages more tie-ups between firms, and new takeover rules are poised to make it easier to do deals. HSBC Holdings plc-backed Saudi British Bank and Alawwal Bank, in which Royal Bank of Scotland Group plc owns a 40% stake, are in talks to merge, while Jabal Omar Development Co also hired Goldman Sachs to advise on a potential merger with Umm Al Qura Development.