Are we seeing the start of a pan-Asian lab network?
It’s been an interesting few days in the Asian lab sector, which could see moves to consolidate a fragmented market.
First, Australian group Healthscope divested itself of its pathology operations in Singapore, Malaysian and Vietnam and the buyer, TPG Capital Asia, says it plans a Pan-Asian lab group. So far we know of only one other such group the shadowy Labnet Global which covers most of the Russian CIS and whose owner Tolondu Toichubaev also has interests in Vietnam and China.
TPG clearly knows what it’s doing – it used to own Healthscope after all. Pair that with strong pan-Asian expertise and deep pockets, and its clear TPG is worth keeping an eye on. It seems unlikely they will be happy to settle for what they have got when the synergies offered by other groups must look so tempting.
Where might they look to next? Well, rumour has it that newly acquired under-fire Fortis in India might just be looking to offload SRL after Malaysian giant IHH bought Fortis out for $1.3bn. SRL has certainly been hitting the headlines recently at home with a very visible push for business, opening 100 collection centres in 100 days, but is this just firefighting in the wake of losing out to competitors?
It seems more likely this is an attempt to recoup lost business, to impress new owners, or – perhaps – window dressing ahead of a sale. It is hard to believe that Fortis (and its new owners) would be too reluctant to sell for the right price given SRL’s recent problems.
The vast Chinese market is also an opportunity, although so far this has been a low margin business dominated by outsourcing contracts won from public hospitals.
But equally TPG could focus on the many fragmented national markets such as Vietnam, Indonesia or Pakistan.
Subscribers can read more about these developments this week.
We would welcome your thoughts on this story. Email your views to David Farbrother or call 0207 183 3779.