* To place around 68 mln new shares at 70 pence
* Funds to provide working capital, aid expansion
* Targets NHS Trust management deals
LONDON, May 29 (Reuters) - Circle Holdings, a British health workers’ co-operative backed by investment funds, said it hopes to raise 47.5 million pounds ($75 million) from investors to help it win deals to manage more hospitals in the UK.
Its Circle Health unit, which last year became the first non-governmental body to run a general hospital for Britain’s state-funded National Health Service (NHS), on Tuesday said it hoped to raise the cash by placing some 68 million shares at a price of 70 pence each with new and existing investors.
“We believe this placing and subscription significantly strengthens the company’s balance sheet and fully finances the business in the medium term, allowing the management team to fully exploit the market opportunity,” said Circle Holdings chairman Michael Kirkwood.
The funds will also provide working capital to help Circle’s strategy of bidding to take over the management of further NHS Trusts when they are put out to tender as part of Britain’s NHS reforms, the company said, adding that three-quarters of its shareholders had already backed the move.
Circle last year signed a contract to run Hinchingbrooke Health Care NHS Trust in Cambridge, east England, becoming the first non-governmental body to run an NHS hospital.
Britain’s recent health reforms have paved the way for greater private sector involvement in the NHS.
The private healthcare operator said that the funds would also be used to pay down debt and meet its working capital requirements at Hinchingbrooke and its independent hospital in Bath, south west England.
Circle Health, is a subsidiary of Circle Holdings, which floated on London’s junior AIM market last year. Circle Holdings’ chief executive is former Goldman Sachs banker Ali Parsa.
The company also said its losses for 2011 narrowed to 13.6 million pounds from a 15.4 million pounds a year earlier. It said revenues fell 2.4 percent to 74.6 million pounds.