SINGAPORE Ayala Corp, the Philippines' oldest conglomerate, is exploring selling a minority stake in Ayala Healthcare Holdings (AC Health) in a potential deal that could value its healthcare arm at up to US$500 million, two people said.

Ayala has hired Bank of America to explore the sale of the minority stake AC Health to strategic investors or partners, that will help further expand the business of the healthcare arm, the people added.

The people, who have knowledge of the matter, declined to be named as the deliberations were private.

The exact minority stake size to be potentially put on sale was not immediately certain. No final decision has been made on the sale, the people said.

In a response to Reuters on Thursday, Ayala said in a statement that AC Health is looking to continue to build its portfolio and has a healthy pipeline of potential targets.

"With this, AC Health continues to explore all options, including engaging with a partner at different organisational levels, for its next stage of growth," it added.

Bank of America did not immediately respond to request seeking comment.

Southeast Asian healthcare assets are gaining favour as global investors bet on the region's growing affluence and aging population, and the sector's ability to weather the current challenging economic environment.

In November, Australia's Ramsay Health Care and Malaysian conglomerate Sime Darby Bhd (SIME.KL) agreed to sell their stakes in their hospital joint venture, Ramsay Sime Darby Health Care, to Columbia Asia Healthcare for RM5.7 billion (US$1.25 billion).

Established in 2015, AC Health has grown steadily and has a portfolio that includes drugstore chains Generika and St Joseph Drug, and pharmaceutical importer and distributor IE Medica and MedEthix, according to its websites.

It also counts Healthway and QualiMed, a network of multi specialty clinics, ambulatory centres and full-service hospitals, and KonsultaMD, a healthcare aggregator app, under its portfolio, its websites showed.

For 2023, AC Health posted a 19% jump in revenue to 8.6 billion Philippine peso (US$147.51 million), driven by higher contributions from pharma, clinics, and hospitals businesses, according to the company's presentation posted on its website.

AC Health's core earnings before interest, taxes, depreciation, and amortisation, or Ebitda, jumped 23% to 722 million peso, the presentation showed.

Besides healthcare business, Makati City-headquartered Ayala has interests including in property, banking, telecommunications and power, and is one of the largest conglomerates in the Philippines, its website showed.

  - Reuters