The DM Group, a UAE healthcare firm, plans to spend as much as Dh1.3 billion (US$354 million) in the next five years to expand its operations threefold in the GCC and India. The group, which operates hospitals, pharmacies and clinics in the UAE, Oman and Qatar, will try to triple in size in the GCC with a significant focus on the Saudi market, said Dr Azad Moopen, the chairman of DM Group.
"We will spend a total of Dh500m expanding in other GCC countries, with up to Dh800m for a large expansion in India," Dr Moopen said. DM Group operates 45 pharmacies, 25 clinics and four hospitals, most of them in the UAE. While the firm's investment is not as large as investments in the region by Mubadala Development, the Abu Dhabi Government's strategic investment arm, and Emaar Properties, the largest listed developer in the Middle East, it indicates a greater emphasis on expanding the Middle East healthcare industry, said Peter Albinsson, a partner at Santeum Partners.
"By no means is it a big investment but it's an appropriate figure. The region can absorb much more funding," said Mr Albinsson. "The moves in Saudi Arabia are much needed because of the demand of available facilities that exist there." Healthcare spending in the GCC is expected to increase to $60bn from $15bn by 2026, according to McKinsey, a management consulting firm in New York. Health care has also proved to be a resilient business, performing well in last year's tough economic conditions. Demand will remain strong as GCC countries struggle to cope with ageing populations and rising incidence of obesity-related diseases such as diabetes.
"Our budget expectations have been met and we feel reasonably certain that it will continue to grow," Dr Moopen said. The UAE is witnessing considerable investment in health care after the Ministry of Finance announcement that 6.4 per cent of its Dh43.6bn budget for this year would be spent on the sector. Dr Moopen said the company would finance its expansion through existing cash flow, capital from its private equity partner, the India Value Fund, based in Mumbai, and with loans.
@Email:dgeorgecosh@thenational.ae