JEDDAH, 1 March 2004 - A new private medical company is to build 12 medium-sized hospitals, 30 polyclinics and 25 dental clinics across the Kingdom over the next five years. The company is being launched by Riyadh-based Healthy Solutions, which recently signed an advisory and placement agreement with Jeddah-based financial advisers BMG. The first phase, covering the next two years, will see the construction of three 50-bed hospital, nine polyclinics and six dental surgeries at a cost of SR150 million.
The project comes as a "timely response" to the new insurance law, according to Basil Al-Ghalayini, CEO of BMG. The aim, he says, is to combine high-quality medical services with reasonable costs and charges to the patient and insurers. He predicts that the hospitals and polyclinics, located in some 18 towns and cities throughout Saudi Arabia, will be able to compete very strongly against more expensive medical centers.
Finance for the project will be a mix of equity and debt. BMG is preparing a private placement memorandum which will be published in the next few weeks, but already investors are lining up, according to Al-Ghalayini, because of the "strong appetite" among Saudi, Kuwaiti and Emirati investors for the Saudi healthcare market. Two-thirds of the required equity in the new stock company had already been pre-sold, Al-Ghalayini said. Healthy Solutions, which has two dental clinics and a medical center in Riyadh, will manage the new hospitals and clinics in cooperation with international health companies. The plan is to merge Healthy Solutions' existing operations into the new company.