Virtus Health will begin its management roadshow on Monday in an effort to attract more than $500 million for an initial public offering in May.
The IPO will be put to investors in Australia, Britain and parts of Asia and would become the largest Australian equity offering since SCA Property, a Woolworths subsidiary, raised $472 million in November last year.
Virtus advisers Morgan Stanley and UBS have valued the company at up to $682 million and $484 million respectively.
Virtus Health, which specialises in IVF science, is 43 per cent-owned by Australian private equity firm Quadrant and medical professionals around the country.
It is understood that the stake held by medical practitioners will be sold down to about 23 per cent.
Quadrant will also dilute its holdings, but sources said the firm had not yet decided by how much.
Virtus operates 34 fertility clinics, 16 embryology laboratories, 17 andrology labs, six diagnostic labs and six hospitals in New South Wales, Victoria and Queensland.
According to notes sent by UBS to institutional investors, Virtus holds about 35 per cent of Australia's $520 million assisted reproductive services market.
Australian listed healthcare companies have enjoyed strong returns in recent times, with the ASX200 health sector jumping 45.6 per cent in 2012 and 10.1 per cent so far in 2013. Since the beginning of 2012, the sector has been led up by CSL and Ramsay Heathcare, up 93.5 per cent and 67.53 per cent respectively. The only company in the 11-member sector to record losses was Mesoblast, which fell 15.53 per cent.
According to the Institute of Health and Welfare, Australia spent $130.3 billion on health in 2010-11, $5796 a person.
UBS said investing in health still involved risk.
"The healthcare sector is highly regulated and assisted reproductive services [are] about 55 per cent funded by patient access to government funding. Any change in government policies ... could materially affect Virtus' operations and expansion strategy," it said.
However, Morgan Stanley noted the increasing trend of women giving birth at a later age would allow Virtus to take advantage of its large market share.