NMC Health eyes expansion in Saudi Arabia
THE KINGDOM IS A HIGHLY ATTRACTIVE MARKET WITH STRONG DEMOGRAPHIC DEMAND, COMPANY’S CEO SAYS
Abu Dhabi-based NMC Health is planning to expand in Saudi Arabia due to growing opportunities and strong demand in the health-care sector, its chief executive officer told Gulf News.
The London-listed company has significantly increased its presence in Saudi Arabia in recent times and currently owns five hospitals with a combined bed capacity of 650.
“With a population of 33 million, increasing levels of health insurance and disposable incomes on the rise, the Kingdom of Saudi Arabia is a highly attractive market with strong demographic demand. Hence the reason for our expansion into the kingdom, making us the second largest player in the private sector,” said Prasanth Manghat, CEO and executive director of NMC Health.
A few weeks ago, the healthcare firm announced a transformational joint venture with General Organisation for Social Insurance (GOSI) owned by the government of Saudi Arabia to become the second largest health-care player in the kingdom. It also acquired an 80 per cent stake in Riyadh-based Al Salam Medical Group for $37 million (Dh135.89 million) earlier this year.
“In Saudi Arabia, to date, NMC already has invested in developing an increasingly strong geographic footprint. We have seen early success through our verticals-based strategy in the UAE and, in our experience, we believe Saudi Arabia is well suited to replicate this approach.”
The comments come as Saudi Arabia aims to attract foreign direct investment in health care and other sectors to boost its economy as part of the Saudi Vision 2030 that aims to wean away the country from its dependence on oil.
NMC currently manages over 150 health-care facilities including hospitals and clinics in fourteen countries across the GCC (Gulf Cooperation Council), Europe and Latin America.
When asked NMC’s investment outlay on acquisitions and further expansion in the short term, Manghat said the company evaluates every opportunity on merit with various decision-making verticals and then takes a call on allocating the necessary capital.
“Raising or allocating the necessary capital is not an area of concern as much as it is in finding the right business fit. We are keen to grow owing to strong operational and financial performance for many years now.”
On the UAE health-care sector, Manghat said it is poised to grow due to various factors such as the plans of the government to attract inflow of medical tourism as well as the mandatory insurance plan in the northern emirates.
“In the UAE, we have been focusing on capabilities enhancement. The group has a strong network and provides for a gamut of health-care services started with multi-specialty and then enhanced through acquisitions by adding long-term care [Provita], fertility [Fakih] and recently cosmetics [Cosmesurge] expertise.”
“We are also focusing on the northern emirates, especially Sharjah where we have a strong presence through Al Zahra Hospital and Sunny Medical centres, and the anticipated rollout of mandatory insurance will further drive growth for the group.”
UAE market potential
NMC Health sees further opportunities in the UAE due to the introduction of a 100 per cent foreign ownership law and the 10-year long-term investment visa.
“The advent of additional international investors and providers shall promote transparency and improve quality of health care based on international standards.”
This decision is also going to attract quality medical staff into the country and will also stem the flow of patients to Europe or America on the availability of international care locally, he added.