Is the healthcare sector on the cusp of a boom in 2018? The healthcare sector is expected to see an upswing in both M&A activity and fresh investment this coming year, a number of industry insiders tell Al Borsa. This follows a disappointing eight months in which M&A and investment dropped significantly. After Cleopatra Hospitals Group’s acquisition of Nile Badrawi and Al Shorouk hospitals, we haven’t seen much M&A activity, says Khaled Samir, member of the healthcare division of the Federation of Egyptian Industries. A number of factors have led to this lull. Topping the list: hospitals are overvalued and there’s been a scramble by industry insiders to form vehicles and raise capital to go after opportunities including management buyouts. 2018, however, looks set to see a number of new investments. These include Saudi German Hospitals developing four new hospitals, Saudi Arabia’s Andalus Holdings investing EGP 750 mn in new developments, while Cleopatra plans to spend c. EGP 1 bn on new acquisitions.

Health Ministry’s plan to cap private sector prices could scare off investments: Problems in the sector persist, and what’s frightening investors the most appears to be the Health Ministry’s plans to cap prices private-sector healthcare. Other problems also include constraints on availability of land for expansion as well as the simple fact of there being few hospital assets in play.