One of the largest healthcare conglomerates in Chile, formed through the consolidation of several companies operating in diverse segments of the healthcare industry, including Isapre Cruz Blanca, Integramédica, and three regional hospitals. By the time of Linzor’s final exit in 2012, the company had 590,000 health insurance clients, 366 hospital beds, and a network of 24 outpatient centers providing over five million health consultations and four million lab tests per year.
Cruz Blanca Salud S.A.
Country: Chile
Investment Date: January 2008
Fund: LCP I
Current Status: Realized
Case Study
- Build a leading healthcare platform combining both insurance and healthcare providers, allowing for improved service and lower costs.
- Capitalize on double-digit growth of the healthcare sector; rising per capita GDP; aging population; and increase in frequency usage
- 50/50 JV with Said Group; active role in running the business.
- Recruited experienced management team with equity-based compensation.
- Creation of CBS as a holding company to consolidate assets and generate synergies
- Increased cross-selling between the three businesses: insurance plans with preferential coverage for Isapre beneficiaries, zero co-payment for Isapre’s members in imaging and laboratory exams, launched managed care programs
- Completed the turnaround of the Isapre: rebranded the company, improved affiliation and collection rates, restructured sales teams, enhanced product portfolio, reduced Medical Loss Ratio and SG&A expenses
- Completed aggressive expansion and capex plans at hospitals.
- The acquisition of Integramédica consolidated CBS’ strategic presence in Santiago, produced synergies from the strong business overlap with the Isapre, and gave CBS the necessary scale for a successful IPO.
In June 2011, CBS completed its IPO in the Chilean market with local and international investors. Linzor sold 44% of its stake in the IPO and the remaining 56% was sold in two tranches in 2012 (March and August). The investment generated attractive returns in excess of Linzor’s base case
