Bain Capital is mulling an exit from Asia Pacific Medical Group (APMG), a Shanghai-based medical service group, sources familiar with the situation said.

The private equity owner was in discussions with some investment banks and advisors tapping the full exit of APMG, which operates nine core hospitals in China, the first and second sources said.

The sale intention stemmed from China’s pilot plan to open its doors for wholly foreign-owned hospitals late last year, the third source said.

The exit plan is still at preliminary stage, with no timeline confirmed, said the sources.

Bain hopes to make a full exit from the group, which had CNY 1.6bn (USD 220m) revenue and EBITDA of CNY 215m (USD 30m) in the last 12 months (LTM) ended September 2024, said the first source.

It has a 10% EBITDA growth year-over-year and is expected to value at mid-teens EBITDA multiples, he said, adding that the deal could be valued at USD 400m.  The 2024 EBITDA reached around USD 50m, said the second source.

Bain could also consider selling the hospitals in the group in separate deals, depending on the buyer interests, said the fourth source.

China announced its plans to allow the establishment of wholly foreign-owned hospitals in certain cities and regions across the country, according to an official document unveiled last September.

These hospitals will be permitted to open in Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen and throughout the island of Hainan, according to a circular jointly issued by the Ministry of Commerce, the National Health Commission, and the National Medical Products Administration.

Bain acquired APMG in 2016 and made several bolt-on acquisitions of specialized hospitals later, focusing on neurological diseases and oncology treatment, according to its website. APMG subsequently raised hundreds of millions of CNY in Series A funding round from IDG Capital and PICC, with GL Capital Group also participating in this round in November 2022, according to its press release.

It currently operates nine hospitals in Beijing, Shanghai, Zhengzhou, Ningbo and Zhenjiang, with 3,500 beds. They handle nearly two million annual outpatient visits, over 45,000 inpatient admissions, and 30,000 surgeries per year, of which 60% are highly complex, as per the website.

Bain Capital declined to comment. APMG could not be reached for comment.

[Editor’s note: The fifth paragraph has been amended to clarify the financials are for the last 12 months (LTM) ended September 2024.]