Malaysia state PE firm Ekuinas invests $18m in two healthcare firms, adds $16m to Orkim

Image taken from Ekuinas website.

Government-linked private equity firm Ekuiti Nasional Bhd (Ekuinas) has made its maiden healthcare investments worth MYR79.8 million ($18.18 million) in two Third Party Medical Claims Administrators (TPA) service providers.

The investments comprise the acquisition of 60 per cent equity in MediExpress Group (MediExpress), which consists of MediExpress (Malaysia) Sdn Bhd and Health Connect Sdn Bhd, and another 60 per cent equity in PMCare Sdn Bhd (PMCare).

TPAs act as an interface between consumers, medical funders and health providers, directly tapping into the growth of healthcare and health insurance markets, the firm explained.

MediExpress is a leading Managed Care Organisation (MCO) which operates as a TPA for insurance companies and small medium enterprises (SMEs) segment, whilst PMCare is the leading bumiputera (native) TPA service provider, focusing on the corporate client segment.

Ekuinas said, the two companies shall later be merged under one holding company, to create the largest TPA provider in Malaysia with 40 per cent market share and servicing more than two million members.

Chief executive officer Abdul Rahman Ahmad said, the investments were in line with Ekuinas’ mandate to create industry leading groups in high growth sectors.

“Ekuinas plans to leverage on each company’s strengths in providing value-added services to their customers through a proprietary high technology platform to further expand their business and grow regionally,” he said in a press statement.

Chairman Raja Arshad Raja Uda commented that the healthcare sector is one of Ekuinas’ six identified target sectors for investment and the TPA market forms a fast growing sub sector with a current estimated size of MYR100 million and expected to grow by 10 per cent per annum to reach MYR156 million in 2019.

“Together, they provide a platform for Ekuinas to form the leading TPA service provider in Malaysia and regionally in line with Ekuinas’ mandate to create future market leading companies.”

MediExpress was originally incorporated in 1998 for the purpose of managing Sihat Malaysia under the initiative of 39 insurance companies. It is headed by Paul Cheok focusing on managing inpatient benefits on behalf of insurance companies and through Health Connect, services outpatient benefits administration needs.

The group now has more than one million members across an extensive health provider network of over 3,000 clinics and 150 hospitals.

PMCare, which is led by Wan Shukri Ariffin and Adzahar Abdul Wahid, specialises in the administration of corporate clients’ medical benefits and caters to over 600,000 members across more than 3,000 medical providers nationwide.

Together, both companies generated a combined revenue of more than MYR50.0 million in FY2014.

Follow-on deals

Ekuinas has also undertaken a MYR70 million ($15.95 million) follow-on investment in Orkim Sdn Bhd to help the company finance the acquisition of three additional Clean Petroleum Product (CPP) Tankers.

This brings the total vessels owned by Orkim to 14, making it the largest CPP transportation provider in Malaysia, with an estimated market share of 24 per cent.

Ekuinas first invested in Orkim in December 2014, committing MYR346.3 million for a 95.5 per cent stake in Orkim as part of its strategy to create a leading regional downstream petroleum transportation and logistics group.

With the follow-on commitment in Orkim, Ekuinas’ latest investments amount to MYR149.8 million ($34.13 million), as well as investments completed under its Outsourced Programme, Ekuinas has undertaken a total of 38 investments since inception.

Together with co-investments from private sector partners, Ekuinas has facilitated a total economic deployment of MYR3.2 billion, positively impacting the Malaysian economy.

Also read:

Ekuinas eyes healthcare, focuses on exits & value-add

Malaysia: Ekuinas pushes education porfolio, Ilmu’s IPO to another 6 to 12 months

Malaysia: State PE firm Ekuinas divests from SF Coffee for $5.53m

Ekuinas divests from Burger King for $18m

MY People Dealbook: Ekuinas CEO to retire in Feb; Malakoff CEO resigns

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.