Sunway to list healthcare arm by 2026, in what could be Malaysia’s largest IPO since 2017
The listing of Sunway Healthcare Holdings could raise more than RM3 billion
[KUALA LUMPUR] Malaysian integrated conglomerate Sunway Bhd unveiled plans to list its healthcare arm by early 2026 – a deal that is expected to raise more than RM3 billion (S$914.3 million) and mark Malaysia’s biggest initial public offering (IPO) since 2017.
The flotation will also bring Singaporean partner Greenwood Capital into the public markets as a shareholder in one of South-east Asia’s major private hospital operators.
Sunway Healthcare Holdings (SHH) is 84 per cent owned by Sunway City (SunCity) – which is wholly owned by Sunway Bhd – and 16 per cent held by Greenwood Capital. SHH will undertake a share split ahead of the IPO.
In a filing to the Malaysian stock exchange on Friday (Aug 29), each existing SHH share will be divided into nine. This will expand the company’s issued share base to 10.9 billion shares from 1.2 billion, without altering its RM2.2 billion valuation.
After the split, SunCity will disburse the distribution shares to Sunway Bhd as a special dividend. The conglomerate will then pass these on to its shareholders at the ratio of one SHH share for every 10 Sunway Bhd shares held.
The proposed IPO will involve up to 1.97 billion shares, comprising nearly 1.4 billion existing shares and 575 million new shares that will be offered to the public.
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As much as a 17.2 per cent stake in SHH will be offered to investors, with 14.2 per cent for institutional ones and 3 per cent for retail investors.
Maybank Investment Bank and AmInvestment Bank are advising the listing. The proposed IPO is subject to shareholder and regulatory approval.
Proceeds from Sunway Bhd’s share sale will be used to pare down borrowings, fund working capital and cover listing expenses.
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SHH’s portion of the new share issuance will go towards expanding its hospitals, constructing a new facility, redeeming part of its Islamic medium-term notes, and defraying IPO costs.
“The proposed listing will enable Sunway to unlock the value of its investment,” the group said in its bourse filing. “Sunway, via SunCity, will retain a substantial equity interest of 69.5 per cent in SHH, allowing it to continue benefiting from SHH’s growth and performance.”
Sunway Bhd was founded in 1974 by Malaysian billionaire Jeffrey Cheah, who ranks ninth on Forbes’ list of Malaysia’s richest individuals, with an estimated net worth of US$3.9 billion as at Aug 29.
The group has grown into one of Malaysia’s largest conglomerates, with interests spanning real estate, construction, education, retail, healthcare and hospitality.
Largest IPO in nearly a decade
Earlier reports indicated that SHH’s IPO could be one of the most significant in Malaysia in nearly a decade. Reuters noted that it is expected to raise more than RM3 billion, making it the country’s largest offering since Lotte Chemical Titan’s RM3.8 billion listing in 2017.
Malaysia has had only a handful of billion-ringgit IPOs in the past five years. Mr DIY Group raised RM1.5 billion in 2020, the country’s biggest float in three years at the time, while dairy producer Farm Fresh pulled in RM1.1 billion in 2022 after heavy retail demand.
Sunway Bhd said the exercise would give SHH direct access to capital markets, boost its financial flexibility, and enhance its visibility as a leading regional healthcare operator.
Expansion plans
The company currently runs five hospitals with 1,662 licensed beds, anchored by its flagship Sunway Medical Centre in Subang Jaya.
Its network also includes hospitals in Cheras, Penang, Damansara and Ipoh, alongside businesses such as ambulatory care centres, fertility clinics, complementary medicine, home care and senior living.
In its filing to the local exchange, SHH plans to build new hospitals in Seremban, Iskandar Puteri and Putrajaya, as well as a fertility centre in Kota Bharu. These projects will more than double its capacity to over 3,400 beds by 2032.
The healthcare unit’s robust financials underpin its listing ambitions. For the year ended Dec 31, 2024, SHH posted a net profit of RM257.5 million on revenue of RM1.9 billion.
This was up from RM181.6 million in net profit and RM1.5 billion in revenue in the year earlier.
In Kuala Lumpur, shares of Sunway Bhd closed Friday 0.4 per cent lower at RM4.92, giving the group a market capitalisation of around RM30.9 billion.
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