TROUBLED IRISH private equity group Claret Capital is to receive a $16 million (€11 million) dividend payment from HCA, the largest private hospital operator in the United States.
This is part of a €1.75 billion distribution to stockholders by HCA, which was announced last week. The funds will be paid out on February 5th.
Claret invested $50 million in a $33.5 billion leveraged buyout of HCA in November 2006, making it the group’s single biggest investment.
This dividend payment represents a 33 per cent return on Claret’s investment and is a rare piece of good news for the Irish company, which has been severely impacted by the global credit crunch and has significantly scaled back its operations in the last year.
In a statement published on Friday, Tennessee-based HCA said the distribution would be funded through its existing asset-based and general revolving credit facilities and available cash.
No comment was available yesterday from Claret.
Claret was established by Irish financier Dómhnal Slattery, who made his name in aircraft leasing with Royal Bank of Scotland. The family of Senator Feargal Quinn owns 25 per cent of the business.
It manages funds on behalf of a number of investors, including Cork businessman Barry O’Callaghan and former Anglo Irish Bank chief Seán FitzPatrick.
Claret invested close to $50 million in Mr O’Callaghan’s Education Media and Publishing Group (EMPG) but is set to see the value of its equity wiped out as part of a major refinancing.
Claret participated in the HCA deal via the private equity arm of US investment bank Merrill Lynch, which co-funded the massive buyout with Kohlberg Kravis Roberts (KKR), Bain Capital and a co-founder of HCA, businessman Thomas Frist.
Claret has €450 million in 27 investments. These include stakes in car-rental group Hertz, the National Pizza Company franchise operator in the US, and the five-star St Regis hotel in Washington DC and maritime communications group Blue Ocean Wireless.
It wrote off €2 million on its investment in Irish TV station Channel 6, which is now owned by TV3.
In response to the recession, Claret has laid off a large number of staff in Dublin and closed its US operations.
Tom McAleese, Max Doyle and Brian Maloney all stepped down as directors of Claret last year. The company made a loss of €3.42 million in 2008.
Mr Slattery is currently trying to launch a new aircraft leasing business called Avolon and recently hired a number of senior executives from RBS to help with that plan.
On Friday, HCA said it expects it full-year 2009 revenues to be $30.1 billion compared with $28.3 billion for the previous year.
Its adjusted earnings before interest, tax, depreciation and amortisation are expected to be about $5.5 billion compared to $4.6 billion for 2008.
Based in Nashville, HCA owns and operates 163 hospitals and 105 freestanding surgeries in 20 US states and London.
