Mubadala Health takes 60% stake in UEMedical in push for regional expansion

The deal, which is expected to be complete by September, will give the company access to Saudi Arabia's market

Moorfields Eye Hospital Abu Dhabi is one of 21 hospitals and health centres run by UEMedical. Courtesy Moorfields Hospital

Mubadala Health, the healthcare unit of Abu Dhabi’s sovereign investment fund Mubadala Investment Company, is acquiring a majority stake in United Eastern Medical Services (UEMedical), as it expands its portfolio of healthcare assets beyond the UAE.

The 60 per cent stake bought from Saudi Arabia’s Jadwa Investment and UAE-based United Eastern Group will add multiple hospitals and clinics that are owned and operated by UEMedical in the UAE and Saudi Arabia to Mubadala Health’s portfolio, Mubadala Health said in a statement on Wednesday.

The transaction is expected to close by September this year, it said without giving financial details of the deal.

“This acquisition enhances Mubadala Health’s network in the UAE and the wider GCC region, while demonstrating our unwavering commitment to transforming the regional healthcare landscape,” Hasan Jasem Al Nowais, chief executive of Mubadala Health, said.

“Over the past decade, UEMedical has witnessed tremendous growth and success, operating facilities that have raised the bar in patient care across multiple specialties.”

Mubadala Health is planning to grow both organically and inorganically, "expanding service lines and complementing what we have … and expanding in the right geographies", Mr Al Nowais told The National.

"This acquisition specifically has achieved both [objectives] for us."

Through the acquisition, Mubadala Health will add Danat Al Emarat Hospital for Women & Children, the HealthPlus Network of Specialty Centres, HealthPlus Fertility, the largest IVF provider in the region, and Moorfields Eye Hospital Abu Dhabi to its portfolio. The company will also get a stake in Al Meswak Dental Group – the largest dental and dermatology network in Saudi Arabia, it said.

"Saudi Arabia was always on our map, given the size of the population and under-supplied services in the kingdom," he said. "This is us stepping into the kingdom" and the company has more investment "opportunities that are in the pipeline", he added.

Mubadala Health also plans to expand its footprint across the wider Mena region and some of the emerging markets, including India.

"This means [investments] both ways. This means we take what we are good at, take what we have established in Abu Dhabi to countries that need it and vice versa [by] bringing expertise … that do not exist here," he said.

"Kuwait Bahrain, Egypt, you name it. They are all on our radar."

Following the completion of the deal, Mubadala Health’s portfolio will include more than 10,000 caregivers across 15 healthcare providers in the UAE and Saudi Arabia. The deal adds new subspecialties to Mubadala Health’s network including fertility and IVF, obstetrics, neonatology and paediatrics, it added.

“This acquisition drives innovation and clinical excellence, while expanding the continuum of care across the UAE and Saudi markets as part of an integrated healthcare ecosystem,” Majd Abu Zant, chief executive of UEMedical, said. “We look forward to the next phase of our journey.”

The acquisition also gives the company access to other emirates in the UAE and “you will soon hear about our plans for expansion into Dubai as well", Mr Al Nowais said.

Earlier this month, Olive Rock Partners, an Abu Dhabi-based independent private equity firm also invested in UEMedical.

Olive Rock, in which Abu Dhabi Catalyst Partners became an anchor investor in March, is investing alongside an affiliate of New York-based alternative asset firm Cerberus Capital Management. It did not reveal the value of the investment in UEMedical, but founding partner Muhannad Qubbaj told The National at the time it had secured an "influential minority" stake.

In January, Mubadala brought its fully-owned UAE-based medical assets – Abu Dhabi Telemedicine Centre, Amana Healthcare, Capital Health Screening Centre, Healthpoint, Imperial College London Diabetes Centre and the National Reference Laboratory – into Mubadala Health.

Cleveland Clinic Abu Dhabi remains an integral part of the network that provides long-term care and rehabilitation, telemedicine and corporate medical screening, treatment of chronic diseases and comprehensive lab and testing services.

The launch of an integrated healthcare platform is part of Mubadala’s renewed focus on healthcare and life sciences sectors amid the pandemic that has posed serious challenges to the healthcare sector globally.

The Covid-19 crisis has underscored the need for rapid acceleration of solutions in the areas of telemedicine, health screening and lab testing.

Mubadala, which has an asset base of Dh894 billion ($243.6bn), in March agreed to plough £800 million in Britain's life sciences industry over the next five years, as part of £1bn deal between the UK and the UAE. The UK's Life Sciences Investment Programme that was unveiled last year will contributes £200m.

Earlier this year Mubadala changed its organisational structure along four lines of business – UAE investments, disruptive investments, direct investments and real estate and infrastructure.