Global healthcare M&A accelerates, private equity accelerates Southeast Asia deployment
Last month, Singapore-based healthcare investment firm CBC Group and UK healthcare private equity platform Global Healthcare Opportunities (GHO) announced a merger to create the world's largest healthcare investment management company, with assets exceeding US$21 billion. This has become one of the landmark events in recent global healthcare capital consolidation.
Southeast Asia shows a similar trend. Against the backdrop of accelerated cross-border capital restructuring, the Southeast Asian healthcare market continues to attract private equity funds, strategic investors, and long-term capital.
In the first half of this year, several important transactions have occurred in the regional healthcare capital market. In February, a consortium led by healthcare private equity firm Quadria Capital completed the acquisition of Malaysian pharmaceutical company Apex Healthcare for approximately MYR 1.9 billion (S$617 million), taking it private. In March, Sunway Healthcare listed in Malaysia, making it the largest IPO in Malaysia in nearly nine years.
Deloitte's "2026 Asia Pacific Private Equity Investment Yearbook and Southeast Asia Insights" shows that in 2025, the Southeast Asian private equity market recorded 56 acquisition transactions totaling US$6.4 billion. The healthcare sector accounted for 20% of transaction volume and 14% of total value, second only to TMT (Technology, Media, Telecom).
The report notes that against a backdrop of rising global uncertainty, investors prefer to allocate to industries with stable demand and predictable cash flows, and healthcare is one such defensive asset.
Structural demand stable but public investment insufficient, creating opportunities for private capital
The privatization investment in Apex Healthcare by Quadria Capital is the largest healthcare private equity transaction announced in Southeast Asia in 2025, and also the third largest private equity transaction across all industries for the year.
Quadria Capital partner Ewan Davis told Lianhe Zaobao that this transaction marks the institutional scale reached by the Southeast Asian healthcare industry. "A transaction of this size shows that private capital is not only willing to enter this field but also has the capacity to continuously provide long-term funding support for the transformation of the regional healthcare system. It also reflects growing confidence in the sustainable expansion of healthcare platforms in Southeast Asia."
He pointed out that the core driver for private equity funds entering the Southeast Asian healthcare market is structural demand, including population growth, expanding middle class, accelerating aging, and rising chronic disease burden. At the same time, governments are promoting localization of pharmaceutical technology and production to enhance supply chain resilience.
He added that a key backdrop to the accelerated entry of private equity funds is the chronic underfunding of public healthcare in emerging markets. Many countries' healthcare spending as a share of GDP is far below WHO-recommended levels, some even less than half, creating an annual funding gap of about US$60 billion.
He said: "This gap is still widening. Healthcare demand continues to grow, but public fiscal investment is insufficient, which provides room for private capital to fill the supply gap."
Active investment markets and M&A themes: Hospital M&A and sub-sector rotation
Within the region, Davis considers Indonesia and Vietnam the most active healthcare investment markets, both with large populations and healthcare infrastructure still in development. However, mature markets like Singapore also have many private equity investment and exit cases, such as the medical technology company UltraGreen.ai, which listed on the SGX last December.
Going forward, he expects more large-scale private equity transactions in the region, covering pharmaceuticals and broader healthcare sub-sectors.
Abhay Bangi, ASEAN and Singapore Life Sciences and Healthcare lead at EY-Parthenon, noted in an interview that Southeast Asia's population and economy continue to grow rapidly, with factors such as aging, expanding middle class, insufficient healthcare infrastructure penetration, and highly fragmented service providers driving industry consolidation. As investor preference for resilient and growth-oriented sectors increases, healthcare continues to attract capital inflows.
Regarding changing investment trends, he pointed out that hospital M&A will remain the main theme, with hospitals attracting nearly two-thirds of investment since 2023. However, capital is gradually shifting to higher-margin sub-sectors such as specialty clinics and diagnostic centers, focusing on cardiology, oncology, and dialysis services.
At the same time, adapting to the market environment, capital is shifting from independent telemedicine startups that grew rapidly during the pandemic to enterprise-level B2B platforms and AI solutions embedded in the healthcare system, while hospitals and insurance companies are accelerating their own digital capabilities.
Listed healthcare valuations diverge sharply, may create selective privatization opportunities
Healthcare asset valuations in Southeast Asia are already relatively high. Sunway Healthcare surged 28% on its first trading day, with market sentiment hot, but later its share price fell back below the issue price. Analysts believe the company's fundamentals have good growth prospects, but valuations are high compared to peers, prompting some market correction.
On the other hand, a PwC healthcare investment report notes the "ice and fire" split in public markets, suggesting that privatization transactions for unfashionable listed healthcare companies may increase.
The report argues that with global stock markets at highs, the valuation divergence among listed healthcare companies is intensifying. Some slower-growing or more complex business companies have not seen their valuations rise correspondingly, creating undervaluation gaps that offer privatization acquisition opportunities for private equity funds. Especially in medical technology, companies with complex operations or slowing growth may be potential targets.
The report estimates that privatization transactions in healthcare could increase in 2026, but remain selective, focusing on assets with restructuring, spin-off, or digitalization potential.
Bangi believes that overall valuation levels in Southeast Asia's healthcare industry may stay high. "To support valuations, investors will increasingly create value through platform consolidation and M&A. In the future, funds are expected to flow more into foundational capabilities such as data and process standardization, systems integration, and AI deployment."
