* Mvela, Brimstone each hold 22 percent stakes
Banks prepare South African hospital chain IPO-sources
* Banks working on IPO of Life Healthcare
February 8, 2010
Investment banks are preparing Life Healthcare, one of South Africa's biggest private-hospital operators, for a public listing later this year, people familiar with the matter said.
Credit Suisse and Morgan Stanley are working on a listing, the people said, while one of them said South Africa's Nedbank was also working on the deal.
The step towards an initial public offering (IPO) comes as private investors prepare to sell or list a string of medical technology and healthcare services companies, including Ambea in Sweden, BSN Medical in Germany, and General Healthcare Group (GHG) in Britain.
But there are signs public markets may prove less welcoming than hoped. On Monday, BC Partners cut the price on the IPO of its French care homes group Medica, blaming a deterioration in market conditions.
Black-owned and controlled investment companies Brimstone Investment and Mvelaphanda Group each own about 22 percent of Life Healthcare. Management owns the rest, according to a September article by South African website Fin24.com.
At the end of June, Mvela gave its stake an "intrinsic net asset value" of R1.626 billion, up 14 percent from a year earlier. Using the same technique would imply a value for the whole company of about $950 million.
Life Healthcare competes with listed rivals Medi-Clinic and Netcare but comparisons are made harder because they have more international operations.
The two US banks both boast South African joint ventures -- Credit Suisse Standard Securities, a joint venture with Standard Bank, and RMB Morgan Stanley, a tie-up with FirstRand Ltd's investment banking unit RMB.
Life Healthcare and Mvela were not immediately available to comment. Brimstone, Credit Suisse and Morgan Stanley declined to comment. - Reuters
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