Fearing a takeover of vital sectors of the economy by foreign interests, the government is promoting a bill that allows the state to stop deals that may endanger essential services.
The bill gives the government the power to veto takeovers of large institutions affecting vital sectors of the economy, such as banks and hospitals.
Authorities were prompted to act following a US private equity fund Lone Star’s persistent attempt to buy the island’s biggest lender, Bank of Cyprus.
Concerned over the possibility that a major banking institution could end up in the hands of the private equity fund, the Ministry of Finance submitted a bill to parliament establishing a framework for controlling foreign direct investments.
Gaining time after the equity fund’s withdrawal from pursuing the bank after three failed attempts, the government decided to expand the bill to include healthcare institutions.
The bill will be re-tabled in the following weeks.
It is understood authorities are concerned over moves by an international private equity firm to take over several of Cyprus’ private hospitals, creating a monopoly.
CVC Capital Partners has bought two major hospitals in the capital, the Apollonio and the Aretaeio, through their subsidiary Hellenic Healthcare Group.
At the same time, CVC is eyeing the island’s biggest healthcare institution, the American Medical Centre and the Ippokratio hospital, also in the capital. T
It is also reportedly preparing to bid for the Ygeia Polyclinic in Limassol.
Reports say the government will introduce a retrospective clause, which allows it to examine takeover deals of large institutions.
The bill will allow the government to revisit deals up to 14 months after the completion of the takeover.
The agreement to purchase a majority package of shares of the Apollonio Hospital was made on October 15, 2021.
The takeover of the Aretaeio Hospital was done in June.
Reportedly, CVC Capital invested €120 mln in taking over the capital’s two hospitals.
CVC holds a stake in various companies in different industries, mainly in Europe, the USA and Asia-Pacific.
CVC-owned firms are mainly active in sectors such as private healthcare, marinas, the e-commerce market, the dairy and beverage, frozen food and food and entertainment sectors.
Hellenic Healthcare Group operates six private hospitals in Greece (Hygeia, Metropolitan Hospital, Mitera, Metropolitan General, Leto and Creta Interclinic) and a network of primary healthcare services (HealthSpot and Alpha Lab).