THG gains China foothold with hospital
B750m investment in new Weihai facility
Thonburi Healthcare Group Plc (THG) is expanding its medical and healthcare business in China with the opening of a new hospital worth 1.35 billion baht in Weihai, a tourist destination.
THG has formed a jointventure company — Weihai Welly Hospital Co — with China’s medical equipment firm Wego Holdings Co at a ratio 58:42, respectively, to operate Weihai Welly Hospital, which opened on Nov 2, 2017.
THG invested about 750 million baht in the project based on its share, said chairman Boon Vanasin. THG controls the management contract because of its expertise in the hospital industry.
“This is an international-standard hospital in China. China has a population of over 1.3 billion but lacks good hospitals, so there is huge demand for healthcare,” Mr Boon said.
THG and Wego Holdings want to penetrate the medical and healthcare market in Weihai, especially during the high season when the city is crowded with tourists, as more than 30 million Chinese and foreign tourists visit it each year.
Over 40,000 Koreans live in Weihai, a city in eastern Shandong province, for work and long-stay holidays.
Weihai is one of the cleanest cities in China, so it should have a good medical centre, he said.
The hospital has 150 beds, which it plans to increase to 500 in the next three years. It is hunting for Chinese-speaking doctors, particularly from Hong Kong, Taiwan, Shanghai and Singapore. The hospital wants to add an obstetrics and gynaecology department soon. THG has managed two public hospitals in Beijing for more than 10 years but has not been very successful because management is controlled by the local government, said Mr Boon.
To improve standards, the Chinese government began to reform medical policy a few years ago by granting private or foreign companies the right to manage hospitals on the mainland.
“We have high hopes for the new hospital. It could be in the red during the first three years, but it will show benefits in the long term,” he said.
THG has been expanding its management base in China the past two years, operating 16 hospitals across the country. Management includes business planning and strategy, marketing, training and staff recruiting.
This year, THG expects total revenue from China to be 100 million baht, mostly from hospital management. Revenue is projected to climb to 120 million baht in 2018.
Mr Boon said THG has outlined a fiveyear plan for the China market, aimed at investing in 10 full-service hospitals in modern cities such as Beijing, Shanghai and Guangdong.
“The new investment is expected to be around 2-3 billion baht,” he said.
Outside China, THG has a joint venture with ArYu International Hospital in Yangon, a 40:60 split, to build a hospital scheduled to open in January next year. THG is to manage the 200-bed hospital, set to serve wealthy patients who otherwise would come to Thailand for treatment.
In Thailand, the group operates two hospitals in Bangkok and three hospitals in the provinces, with a total of 916 beds.
THG recently announced plans to develop Jin Wellbeing County on 140 rai in Rangsit. The project is valued at 4.4 billion baht and consists of 1,300 units for living, rehabilitation and elderly care.
Last year, THG’s total revenue was 5 billion baht. The group expects revenue to rise 10% this year and 10-15% in 2018.