Thursday 3 July 2014

Thonburi Group clinches JV in Myanmar

MOU signed with Aung Kyi Shwe International for Bt1 bn, 150-bed hospital in Yangon

Thonburi Hospital Group yesterday signed a memorandum of understanding with Aung Kyi Soe, managing director of Aung Shwe Thee International (AST Group), a leading property group in Myanmar, for a joint venture to invest in a 150-bed private hospital in that country at the cost of Bt1 billion.

A majority 51-per-cent stake in the JV will be owned by Thonburi Hospital Group, and the rest by the Myanmar partner.

Boon Vanasin, chairman of Thonburi Hospital Group, said the agreement was part of a three-year plan to invest more than Bt5 billion jointly to build private hospitals in three major cities in Myanmar, namely Yangon, Mandalay and Tantabin. The first will be opened in Yangon by the end of next year or at the beginning of 2016.

The group also plans to open 10 small clinics in those three cities, of which five will be in Yangon, three in Mandalay, and two in Tantabin.

"Myanmar has been recognised as a land of tremendous opportunities for investment in medical services," Boon said.

"After being closed [to investment] for a long time, Myanmar is now lacking good healthcare-system development. Myanmar people with good financial status would often come to Thailand for medical treatment. They make up the second-largest number of patients at many private hospitals in the Kingdom."

He said Thonburi Hospital Group had seen a good opportunity to invest in joint ventures in Myanmar to cater to increasing demand for medical treatment and other healthcare services, both from local people themselves and foreign investors who began doing business there after the country opened up.

"The hospital business has enjoyed strong potential in Myanmar after the government started to make significant [improvements] in the social-security system so that people with middle to higher incomes will spend money to receive better treatment with the private hospitals. This means the number of private hospitals has not kept up with increasing demand," Boon said.

He said KfW, a German development bank, in cooperation with AME International in Austria was considering granting low-interest loans for the hospital project, which would make up about 60 per cent of total investment capital. A feasibility study on the project will be finalised within three months.

Kyi Soe said this would be the first large-scale foreign private hospital ever opened in Myanmar. The country itself currently has about 42 private hospitals.

"We decided to take a partnership with the Thai company as both of us share a similar culture and religion and are close neighbours.

"The hospital groups in Thailand are also well able to provide service and good management both in health treatment and personnel," Kyi Soe said.

source: The Nation

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