Exclusive - Nordic Capital agrees to buy German nursing home group Alloheim

By Arno Schuetze

FRANKFURT (Reuters) - Buyout group Nordic Capital has agreed to buy Alloheim, Germany's second-largest nursing home operator, for about 1.1 billion euros (£1 billion) including debt, people close to the matter told Reuters.

Nordic Capital confirmed the deal, but declined to comment on the purchase price.

It also said that it intended to support Alloheim's management and to invest in further expanding the company's facilities and services.

Carlyle, the seller, declined to comment.

Nordic Capital prevailed in an auction against DomusVi, backed by Intermediate Capital Group, as well as buyout groups Ares and Fosun, the sources close to the matter added.

The deal values Alloheim at about 12.5 times its 88 million euros in earnings before interest, tax, depreciation and amortisation expected for 2017, the sources said.

The Alloheim sale follows a string of similar deals, including the sale of French rival DomusVi and Germany's Casa Reha and German clinic chain Schoen.

The broader healthcare sector has also seen some high-profile deals this year in Germany, including the sale of generics group Stada to private equity firms Bain and Cinven.

Separately, German drugs and high-tech chemicals company Merck is currently trying to sell its consumer health division valued at up to 4 billion euros.

Banks are offering to part finance the Alloheim deal with debt packages of about 6.5 times core earnings, which could include senior and subordinated loans and bonds or all senior loans, people close to the matter said.

Since Carlyle bought Alloheim from Star Capital in 2013, the buyout group has added to the business with a series of acquisitions.

Alloheim, founded in 1973, currently operates 155 nursing homes with 20,000 residents. It employs 14,500 staff.

($1 = 0.8446 euros)

(Additional reporting by Claire Ruckin and Pamela Barbaglia; Editing by Douglas Busvine/Keith Weir and Jane Merriman)