Exploring Saudi Arabia’s “completely different universe” for healthcare investors, with Youssef Haidar of Nexus Gulf
This interview features in the HBI 2025: Disruptive Innovation: Investing in Healthcare Transformation Conference Report, which was shared with conference delegates, and is available to HBI Deals and Insights and Intelligence members.
Youssef Haidar
Founder and Executive Director of Nexus Gulf
Saudi Arabia’s rapidly developing private healthcare sector offers significant opportunities for international providers prepared to enter the country with the right partnerships, according to Youssef Haidar, Founder and Executive Director of Nexus Gulf.
The country’s healthcare market, valued at ~€60 billion within Saudi’s ~€1 trillion GDP, represents a challenging but uniquely rewarding frontier as it transitions from predominantly public to majority private ownership. Haidar, whose firm has established multiple healthcare joint ventures with international providers in the region, shared with us his investment thesis, view on the Saudi Arabian and wider GCC private healthcare market, and what attributes Nexus Gulf looks for in prospective clinical partners.
Vision 2030 is driving healthcare development and a rapidly growing private sector
“If you speak to any clinical operator in Europe, you hear the same things: pressure on budgets, margin pressure, worries about inflation and recession. In our region, and in Saudi Arabia specifically, it’s a completely different universe.”
Saudi Arabia’s Vision 2030 has created a highly conducive climate for healthcare investment and market development, with the introduction of comprehensive legislative reforms complemented by robust government backing. The goal of the Saudi Arabian government, according to Haidar, is to supercharge the development of the country’s private healthcare sector.
“There is enormous energy and enormous resources that have been put in place to ultimately realise a vision of opening up the markets into private investment,” Haidar explains. “What’s driving this market is a different set of considerations [to Europe]. The government has put in place over the last few years a lot of soft infrastructure that has made the market ready.”
Much of the development of this ‘soft infrastructure’ has been provoked by a major shift in Saudi Arabia’s regulatory landscape, following a series of legislative updates intended to enable private investment, creating what Haidar describes as a “transparent and supportive” framework for international partners.
“There are half a dozen to a dozen laws that have changed that cover everything from foreign ownership rights to own healthcare assets, to contract law, to companies law, to discretisation,” he explains.
One such change was the updating of the Private Healthcare Institutions Law in 2019 to allow foreign ownership of healthcare facilities, except for standalone clinics — although polyclinics are permitted. Previously, foreign ownership was only permitted for hospitals. The Private Sector Participation (PSP) Law, passed by the Council of Ministers in March 2021, has meanwhile furthered the framework by which private entities can engage in Public Private Partnerships in the Kingdom, and is intended to advance Vision 2030’s “Privatization Program”. These are but two reforms among many.
This regulatory evolution has been accompanied by a shift in how public healthcare institutions are expected to engage with the private sector. Saudi Arabia is actively seeking to develop new healthcare service capabilities, with the private sector, including international participants, seen as playing a vital role in sector development.
“In Europe, you’re dealing with doing more with less, trying to be more efficient and creative. In Saudi, it’s a completely different market. There’s a huge willingness and drive by the government to enable the private sector. There’s a drive towards having the public sector contract with the private sector to introduce capabilities, localise services, and transfer knowledge. There’s a lot of contracting that’s happening between the public, quasi-public, and private sector,” Haidar told us.
The rebalancing from public to private healthcare provision is already well underway, with the government actively facilitating this transformation. “Today the market is around 30% private, 70% public. The stated intention of the government is ensuring that the majority of the market over the next few years becomes private,” Haidar reveals.
This shift represents a significant opportunity in a substantial and growing market. “Healthcare spending in Saudi is around $65 billion. The GDP of Saudi Arabia is around $1.1 trillion. So, this is a big market with a big healthcare market within it,” he notes.
Government support extends beyond policy to active market participation. “All of this is supported by government budgets that are quite robust and that are driven by the economies of the [GCC] region,” Haidar emphasises, highlighting the financial stability underpinning the sector’s development. While Saudi Arabia and the UAE need to operate within a global environment, the local picture is radically different to that seen in western countries, and increasingly other markets in Asia, too.
Nexus Gulf’s investment thesis
The importance of long-term, active partnerships
Nexus Gulf positions itself somewhat differently from more traditional investors. Backed by Safanad, a global principal investor that has deployed over $10 billion worldwide across healthcare, education, and real estate, the group is anything but a passive investor, and seeks to take an active role in building, managing, and growing its portfolio healthcare businesses. The platform also seeks a longer-term investment relationship with their partners.
“We are structured as a long-term capital provider for our partners,” Haidar says.
We ask if Nexus Gulf’s investment horizon aligns their strategy and approach more with that of infrastructure funds than with private equity:
“In terms of the tenor, and in terms of the exitability, we are structured maybe closer to infrastructure funds than private equity — we are not doing four-year turnaround planning. However, we don’t invest for life, so really our approach is somewhere between the two.”
This approach allows Nexus Gulf to work more strategically with international clinical partners to develop healthcare businesses in the region, without the need to generate much more immediate and shorter-term returns.
“If you want to tackle healthcare opportunities in our region, which naturally means teaming up with clinical operators and building a business, it might become counterproductive to work with the kind of deployment pressure or exit pressure that comes with typical private equity funds,” Haidar asserts. Haider is no stranger to the private equity world, having worked for 25 years in PE.
Additionally, rather than pursue a more diversified investment approach, Nexus Gulf maintains a concentrated focus.
“We only invest in healthcare, and within healthcare — [more specifically] we focus on healthcare service delivery,” Haidar explains. “For a focused investor staying close to market development, if you end up with too many opportunities, something is not right. We keep it tight, and we keep it specialised.”
While the firm’s primary focus is within Saudi Arabia and the GCC, Nexus Gulf benefits from Safanad’s global footprint and extensive international healthcare investment experience. Safanad owns HC-One, the largest senior home network in the UK, for example. The broader group has also invested in one of the larger behavioural health platforms in the US, exiting a few years ago.
This international perspective informs their regional strategy. “It really complements our local capabilities having grown and developed many healthcare service platforms in partnership with clinical operators globally,” he explains. “We are quite able to act on opportunities as and where they come.”
Nevertheless, Haidar emphasises that the Kingdom remains at the centre of their strategy, and where their greatest opportunities lie:
“Our primary focus is Saudi Arabia simply because the opportunity is so clear to us and because we’re based there. We are backed by one of the very strong local families in a market that’s growing at a much higher speed. So that will continue to be our primary focus.”
The market opportunity of a rapidly opening, underserviced, and investment-hungry market like Saudi Arabia is a compelling proposition for European operators, according to Haidar, presenting a rare opportunity to access a growth market at a time when established healthcare systems face increasing pressures.
“The Saudi market is really offering what a lot of these groups look for, which is growth,” he concludes, which is an opportunity, according to Haidar, “to put European providers’ capability and efficiency to use in markets that are growing, at reasonable margins, while improving local quality and access.”
In Haidar’s assessment, this combination of growth potential, supportive government policies, and long-term capital partnerships makes Saudi Arabia an increasingly attractive destination for healthcare investment — a stark contrast to the constrained conditions facing operators in more established markets.
Moving care outside of hospitals is key to market development and value creation
Nexus Gulf’s investment thesis focusses on the evolution of healthcare delivery systems — specifically, transitioning appropriate services from hospital settings to specialised care centres.
“Any type of service that we can take out of a hospital setting and put in a standalone centre with volume-based competency at cheaper real estate gives us the ability to provide a better service, with more volumes, at a better price point,” says Haidar.
The Saudi market is primed for this transition. “The market today is heavily dominated by hospitals because this is the first market that develops in any healthcare system. We think we are at the stage now where we need to work with private healthcare settings and take specialised volume out of hospitals.”
This approach benefits hospitals, patients, and investors alike, Haidar explains, outlining the challenges presented by the current balance of service providers. “It’s a disservice to the hospital because they can’t monetise the real estate in the right way. It’s a disservice to the community because they don’t get the right service at the right time with the right turnarounds.”
Delivering successful Public-Private Partnerships (PPPs)
Nexus Gulf has already demonstrated the effectiveness of its model through strategic joint ventures, with eight enterprises in Saudi Arabia under their belt.
Altakassusi Alliance Medical, a joint venture between Nexus Gulf, Alliance Medical, and Prince Faisal Specialist Hospital, won the Ministry of Health’s Diagnostic Imaging Pilot PPP project and now handles a significant portion of Saudi diagnostic imaging. Following the regulatory changes of the past six years, and the positioning of PPPs as a key mechanism for market development, such projects represent an enormous opportunity in Saudi Arabia.
“That company today does over 800,000 exams a year, seeing close to one-third of Ministry of Health patients in Riyadh,” Haidar notes. “It has shown dramatic improvements in KPIs across the board, from waiting times, reporting times, to quality and patient experience, demonstrating the impact the private sector can have.”
Similarly, Nexus Gulf has partnered with France’s Cerba Healthcare in the laboratory market, another example of bringing international expertise to the Saudi healthcare system.
What does Nexus Gulf look for in an international partner?
For international clinical providers considering the Saudi market, Haidar outlines specific criteria.
“We’re looking for, basically, two things,” Haidar explains. “One, we need to be comfortable that the segment that this clinical partner is active in and capable within is a segment where there’s a gap and a need in the market. The market thesis has to be there and more times than not we start with the market thesis. Sometimes the clinical partner opens our eyes to the market, but we have to be tackling a gap in the market where a service is needed at a certain quality that ultimately addresses a local need.”
Secondly, beyond service-market fit, Haidar emphasises the importance of genuine strategic intent. “We need a clinical operator that has a desire to ultimately grow into new markets. So that they are not purely opportunistic but more strategic”.
Most importantly, Haidar emphasises that providers must recognise the true scale of the opportunity. Nexus Gulf requires partners that “take the opportunity for what it really is, and not as an opportunistic play in a small market. Some of these businesses can [grow to] hundreds of millions of dollars in revenue in a span of a few years. This is not by any means a small market.”
Nexus Gulf also expects a degree of innovation from its partners — although that innovation does not have to be technological, and it must play a role within their wider investment and service development strategy.
“Innovation is critical in our markets and just generally globally,” Haidar notes. “Any type of innovation — technology, process or otherwise — that complements this thesis is something that we have a big interest in. We’re in discussion now with a group that has a very interesting way of delivering care that’s not necessarily incredibly tech-enabled. It is tech-enabled, but I wouldn’t say technology is at the heart of it, but the protocol and the way they position themselves is really quite unique and very innovative.”
Addressing local needs through global expertise
A key aspect of Nexus Gulf’s approach is developing opportunities to apply international expertise to the requirements of Saudi Arabia’s domestic market.
“We want to be at the intersection of those two markets where we feel we can bring opportunities and create the right win-win situations,” explains Haidar, referencing the company’s name: “That’s why we’re called Nexus.”
This positioning allows the firm to act as a bridge for international healthcare operators who may lack the resources or expertise to navigate the Saudi market independently.
“Clinical partners typically are not structured in a way where they can deploy resources into a new market in such an exhaustive way that they can develop the market,” Haidar observes. “Particularly when it’s a market that’s not an adjacent market or not European.”
By providing both capital and local operational expertise, Nexus Gulf aims to be “everything your clinical partner is not” — offering complementary capabilities to ensure successful market entry and development.
We would welcome your thoughts on this story. Email your views to Chris O'Donnell or call 0207 183 3779.
