Preparing for a
stiff competition in healthcare before the ASEAN economic integration in 2015,
two local hospital chains are promoted to expand their networks and expedite
joint-venture partner searches.
Bangkok Dusit Medical Services (BGH), Thailand’s largest hospital
group, aimed to expand its network to at least thirty five hospitals before
2015. Currently, BGH has the total of 29 hospitals under the group, said Dr
Pongsak Viddayakorn, a member of the BGH board.
“The AEC (Asean Economic Community) will definietely bring in
large-capital players into the country, so we need to invest more to expand our
network, particularly in provincial tourism markets,” he said. The BGH is
prepared to invest in the new hospitals around TH฿ 400-500 million (US$13-16 million) each hospital.
Dr Viddayakorn said BGH has doubled this year’s capital expenditure
budget to TH฿ 4
billion US$130 million. This excludes spending on potential mergers and
acquisitions, which are estimated at TH฿ 6 billion (US$ 195 million) or less.
BGH now controls 29 hospitals including Bangkok Hospital, Bangkok Heart
Hospital, Wattanosoth Cancer Hospital, Samitivej Hospitals, BNH Hospital and
the Phyathai Group of Hospitals. Through Royal International Hospital, it also
operates a hospital each in Siem Reap and Phnom Penh in Cambodia.
The company owns 38.24% of Ramkhamhaeng Hospital, which owns a 7.8%
stake in Vibhavadi Medical Center Plc, the operator of Vibhavadi General
Hospital and Synphaet Hospital. Both Ramkhamhaeng Hospital and Vibhavadi
Medical Center Plc are in the list of Stock Exchange of Thailand (SET).
BGH last Tuesday reported it spent 2.23 billion baht to acquire an
additional 6.05% stake in another leading hospital chain, Bumrungrad Hospital
(BH), raising its ownership in the latter to 20.28% and making it the largest
shareholder ahead of Bangkok Insurance, which owns 14.65%.
Dr Viddayakorn said the move enables the company to realise BH’s
revenue, in accordance with the equity method, into its consolidated statement.
Last year, BGH reported revenue of 37.8 billion baht, while BH’s
revenue totalled 11.4 billion. Meanwhile, Vejthani Plc, the operator of
Vejthani Hospital, said it is looking for a joint venture to strengthen its
business and prepare its medical service quality ahead of the AEC’s
implementation.
Asst Prof Korpong Rookkapan, the company’s chief operations officer,
said the company has been approached by several hospital chains both local and
abroad.
“A joint-venture scheme allows us to expand our network in the future.
We are also set to launch a new branch by ourselves locally in the future,” he
said.
A joint venture with a foreign partner will provide a shortcut to
providing medical service through partnerships internationally.
“While many people are afraid the AEC will lead to changes in this
business, I’m optimistic about the changes, as this is an opportunity to
develop ourselves and services,” said Asst Prof Korpong.
“The hospital should develop to take care of more specific diseases and
its staff should speak more languages.”
Vejthani Hospital expects its revenue to reach TH฿2 billion (US$65 million) this year, up from
TH฿ 1.4
billion (US$ 45.5 million) last year.
Thanya Kunakornpaiboonsiri
futuregov.asia
Business & Investment Opportunities
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