Thailand’s Thonburi Healthcare Group (THG) has co-invested in the construction of a 170-million-baht ($4.9 million) wellness clinic in Ho Chi Minh City to serve wealthy customers in Vietnam.
The co-investment is a partnership between THG, Vietnamese property developer IFF Holdings, and Mithmitree Clinic, which has operated in Thailand's healthcare sector for 27 years. The three sides signed the co-investment partnership on Thursday.
IFF Holdings is funding 60% of the investment, THG 30%, and Mithmitree Clinic 10%.
The new BeWell Wellness Clinic is set to open in HCMC, where IFF is headquartered, by the end of this year. More branches are planned for Ho Tram in Ba Ria-Vung Tau province near HCMC, and Danang - Vietnam’s central hub - by 2025.
The project focuses on customers interested in healthcare and anti-aging medicine, said Tanatip Suppradit, CEO of THG. “This group of Vietnamese customers has strong purchasing power. They are looking for medical services provided by Thai doctors,” he said.
Vietnam has bright healthcare prospects with a fast-growing economy, he added, to explain why THG is expanding to the country.
IFF Holdings chairwoman Nguyen Thi Mai said the investment is in line with the growing wellness trend that is gaining popularity in Vietnam and ASEAN.
“The economy has begun to recover post-pandemic. That’s why I decided to partner with THG and Mithmitree.
“We have confidence in THG's experience and expertise in delivering world-class medical services as well as Mithmitree’s expertise as a medical clinic network,” she said.
Worasak Manit, CEO of Mithmitree Medical Co., said Vietnam is an important market that his firm sees as an opportunity to expand its wellness business in a market of 100 million people.
THG expects the internal rate of return for this project to be around 20%, with a payback period of 4.5 years. Investment in Vietnam is part of THG's business strategy. In May, THG and Thonburi Bamrungmuang Hospital, also in Thailand, agreed to provide counseling services to French-backed FV Hospital in HCMC. The 220-bed general hospital opened in 2003.
Thomson Medical Group, a Singapore-based healthcare company, confirmed with Singapore newspaper Business Times on Friday that it is in advanced talks to buy a controlling stake in FV Hospital in Ho Chi Minh City after a Bloomberg report on Thursday about the discussions.
The healthcare company, backed by tycoon Peter Lim, has surpassed other interested candidates to remain in the bidding and is working with a financial adviser on the potential acquisition, according to the report, which says the process is private.
Vietnam’s healthcare sector is opening up to investors.
The EU-Vietnam Free Trade Agreement, effective in 2020, has eliminated tariffs on around 71% of pharmaceutical products, and the remaining tariffs will be gradually phased out upon the full implementation of the agreement.
As part of the agreement, Vietnam has committed to allowing EU-invested enterprises to import pharmaceuticals into Vietnam and to establish 100%-foreign owned companies in the pharmaceuticals sector. This should boost the availability of high-quality medications for Vietnamese consumers while increasing the profitability of EU firms in the industry.