Olive Rock Partners takes stake in UEMedical in debut deal

Private equity firm co-invests with Cerberus Capital in Abu Dhabi healthcare group with 21 hospitals and health centres

Moorfields Eye Hospital Abu Dhabi is one of 21 hospitals and health centres run by UEMedical. Courtesy Moorfields Hospital

Olive Rock Partners, an independent private equity firm based in Abu Dhabi, completed its debut deal with an investment in healthcare company UEMedical.

Olive Rock, in which Abu Dhabi Catalyst Partners became an anchor investor in March, said it is investing in the business alongside an affiliate of New York-based alternative asset firm Cerberus Capital Management. It did not reveal the value of the investment in UEMedical, but founding partner Muhannad Qubbaj told The National that it had secured an "influential minority" stake.

“We are excited to partner with the UEMedical team and shareholders to further enhance the growth of this exceptional platform within Abu Dhabi and its neighbouring Emirates as well as abroad, focusing initially on Saudi Arabia,” Mr Qubbaj said.

“This is a landmark deal within a growing and attractive sector globally and we are very pleased to be working with Cerberus to support it.”

The number of hospitals in the UAE grew by 6.2 per cent per year to 158 in 2020, with the bulk (70 per cent) of these operated by private sector companies, according to the UAE Health Sector Pulse report published by Alvarez & Marsal last month.

Abu Dhabi has 66 hospitals containing about 5,500 beds, according to the report. Occupancy rates stand at 55 per cent and the market remains relatively fragmented, with "few dominant players", the report said.

UEMedical was founded in 2008 and has 21 hospitals and health centres. The company operates Danat Al Emarat Hospital, a specialist women's and children's hospital in the UAE capital, as well as the HealthPlus fertility and family health centres and the Moorfields Eye Hospital Centre Abu Dhabi – a joint venture with the London-based specialist Moorfields Eye Hospital NHS Foundation Trust.

The company employs more than 2,300 healthcare professionals and has treated about 700,000 patients. It will use the new funding from Olive Rock and Cerberus to add complementary services and extend its geographical reach.

“With an expanding focus on healthcare in the region, the company [UEMedical] is well-positioned to broaden its reach,” Gabriel Schulze, senior managing director of Cerberus, said. “We look forward to partnering with Olive Rock as we support UEMedical on its mission to deliver exceptional, patient-centric care.”

Olive Rock was founded last year by Mr Qubbaj and Abdullah Shahin, both of whom are former partners at Gulf Capital. The company is currently in the process of raising its debut fund.

Cerberus Capital Management manages $53 billion of private equity, private credit and real estate assets.

Olive Rock and Cerberus were advised on their investment by law firm Freshfields Bruckhaus Deringer.