Equity firm launches $70m health fund

SPECIALIST TRAINING: Healthcare staff look set to benefit from a new investment fund that will target training. (Getty Images)

Private equity firm The National Investor (TNI) has announced plans to raise up to $70m to fund a string of medical ventures aimed at capitalising on the UAE’s underserved healthcare sector.

The Abu Dhabi-based company is to pair with Santeum Partners, a Swiss healthcare advisory firm, to launch a series of low-capital schemes, beginning with a $5m simulation lab to provide specialist training to health workers.

Speaking on the sidelines of a healthcare investment forum, Yahya Jalil, director of private equity at TNI, said the firm had identified a shortfall in funding for soft services, such as niche training, that it hoped to profit from.

‘Over the past three years there has been a significant amount of dollars poured into the development of infrastructure,” he told Arabian Business.

“We believe that in at least three or four of the GCC countries, we could potentially be over-bedded if the hospitals are all completed. However, investment has been lacking in a very significant way in the healthcare services side.

“We believe the GCC market size for services, on an annual basis, is about $100m and growing quite rapidly. That’s where we see the opportunity for us.”

The firm also plans to roll out up to six disease management centres in Abu Dhabi, at a cost of around $15m, to capitalise on the emirate’s growing chronic disease incidence.

The aim, Jalil said, would be to ensure the patient stayed healthy, thus cutting costs for insurance firms, employers or other agencies paying for healthcare.

“The need for these types of services will become apparent, and as there is pressure on the private and government sectors to contain costs, this will present an interesting and viable alternative,” he said.

“In aggregate, we’ve identified about six pre-identified investments, that will have total investment capital of between $60-$75m between all of them.”

TNI has joined a growing band of investment groups moving into the recession-resistant healthcare sector in a bid to boost profits.

Last year Dubai-based Pragma Group inked a deal with Germany’s UKE Consult and Management to launch a string of private healthcare centres, offering four-hour MOTs mainly for corporate clients.

The healthcare arm of Kuwait’s Al Tijaria group has also revealed plans to build a healthcare city in Kuwait by 2012. 
 
However, TNI is one of the first to focus on secondary services, such as training, rather than healthcare provision.

TNI was set up in 1994 as a private joint-stock company. Its investment portfolio spans real estate, investment and petrochemicals, and the firm has paid up capital of AED550m ($150m).

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