US private equity major Warburg Pincus has announced its investment in Vietnam-based hospital group Xuyen A, confirming a DealStreetAsia report in November last year.
Financial details of the investment were not disclosed. In its previous deals in Vietnam, Warburg Pincus has typically invested from $100 million to $370 million in local portfolio companies.
Xuyen A is Warburg Pincus’s first healthcare transaction in Vietnam, but the private equity powerhouse said the deal “underscores the firm’s focus on the country’s rapidly emerging healthcare sector”.
“We believe the private healthcare sector in Vietnam presents a tremendous opportunity for outsized growth, as the hospital infrastructure in the country is significantly underdeveloped,” said Saurabh Agarwal, managing director and head of Southeast Asia private equity at Warburg Pincus.
Xuyen A, founded and led by Dr. Nguyen Van Chau who built the hospital chain from the ground up through greenfield development, celebrates its 10th anniversary this year. The group owns and operates four multi-specialty tertiary hospitals in southern Vietnam, including its flagship hospital in Ho Chi Minh City.
“Together with Warburg Pincus, Xuyen A will continue to explore opportunities to enhance our care offering, scale up through further greenfield or brownfield development, and strengthen our medical team,” said Dr. Nguyen Van Chau, founder and CEO of Xuyen A.
As Xuyen A continues to expand its range of treatments and intensify its focus on specialty care, the company is building a new oncology centre at its flagship hospital, to provide a full suite of services including chemotherapy, radiotherapy, and surgical oncology.
Warburg Pincus has been investing in healthcare for over five decades, the firm said. In Asia, it most recently acquired a stake in Appasamy Associates, an Indian manufacturer of ophthalmic equipment and devices, marking its largest investment in the healthcare sector in India.
Some other transactions in Asia include hospital and clinic network United Family, aesthetic hospital group Evercare and Abbisko Therapeutics in China; as well as MedPlus, Laurus Labs, and Metropolis Healthcare in India.
Warburg Pincus, which started investing in Vietnam in 2013, claims it is the largest global private equity investor in the country with over $2 billion in invested capital.
Its other portfolio companies in Vietnam include logistics and industrial real estate platform BW Industrial, Vincom Retail (which the firm exited), e-wallet MoMo, Techcombank, hospitality platform Lodgis, and real estate developer Novaland.
Jeffrey Perlman, who was promoted to president of Warburg Pincus last year, told DealStreetAsia in an earlier interaction that the $83-billion investment firm saw new opportunities arising from Vietnam’s healthcare and education sectors.
Vietnam’s hospital space has indeed seen an uptick in deal activity. Singapore’s sovereign wealth fund GIC has pumped additional capital into paediatric and maternity clinic chain operator Nhi Dong 315, while Medical Laboratory and Technology Co. Ltd is in the market seeking to raise its first private equity round.
KKR invested in the eyecare hospital chain Medical Saigon Group, a deal that is said to have been sealed earlier this year.
In 2023, Singapore’s Thomson Medical Group acquired FV Hospital for $381.4 million as Quadria Capital exited, and Raffles Medical Group acquired American International Hospital, valuing the Ho Chi Minh City-based asset at $45.6 million.
