Former Hong Kong financial secretary’s firm competes with Fosun-backed hospital operator in Greater Bay Area
- New Frontier has acquired a medical facility together with a plot of land in Shenzhen for 1.12 billion yuan
- Company to build 64,000 square metre general hospital
New Frontier, an investment company co-founded by former Hong Kong finance minster Antony Leung Kam-chung, is competing with international health care providers in the region covered by Beijing’s “Greater Bay Area” initiative.
The initiative aims to link Hong Kong, Macau and nine mainland Chinese cities – one of which is Shenzhen – into an integrated economic and business hub. Last month, New Frontier acquired a medical facility together with a plot of land in Shenzhen’s Futian district from state-owned China Resources Group for 1.12 billion yuan (US$166 million).
The Hong Kong-based company, in which the city’s privately run Nan Fung Group is a major investor, plans to build a 64,000 square metre general hospital. Carl Wu, another co-founder and chief executive of New Frontier, said: “We will build a premium international hospital designed to serve people across the Greater Bay Area, which has a large population of 70 million.”
The hospital is expected to be completed in 2021. “It will provide leading doctors from Hong Kong and around the world. The total investment is about 3 billion yuan,” Wu said in an interview.
Rising wealth and a growing middle class have created strong demand for private health care in China. In fact, in the 13th Five-Year Plan, Beijing has allowed for up to 100 per cent foreign ownership of private hospitals. These previously required a minimum of 30 per cent Chinese ownership.
New Frontier’s latest foray into mainland China will bring it up against United Family Healthcare, the largest foreign-operated hospital in the country. United, run by US hospital operator Chindex, which was acquired by Shanghai Fosun Pharmaceutical in 2014, operates private hospitals and clinics in major cities such as Beijing, Shanghai and Guangzhou.
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“United Family Healthcare is a competitor,” said Wu, who, however, added that the market was too big and could allow more players. “There are a lot of smaller hospitals in Shenzhen, but large-scale general hospitals in core areas across China are limited,” he said.
According to New Frontier, Shenzhen is facing a shortage, with 3.18 hospital beds per capita, the lowest among 14 major mainland China cities.
In 2017, New Frontier invested in Shenzhen-based medical group Best Unimed Medical. The company has interests in new economy sectors such as health care, internet, artificial intelligence, big data, education and financial services
