KUALA LUMPUR: Sunway Healthcare Holdings Bhd plans to accelerate its expansion across Malaysia and potentially into regional markets using proceeds from its upcoming initial public offering (IPO), as the group strengthens its position in the sector.
The healthcare arm of Sunway Group intends to allocate 66.5% of IPO proceeds towards capital expenditure, primarily to expand existing hospitals and develop new facilities, according to group chief financial officer Chow Tee. In addition, 30% will be used to repay borrowings, with the remaining 3.6% covering listing expenses.
Chairman Tan Sri Dr Jeffrey Cheah said the group has a clear expansion pipeline, supported by land already secured for future developments.
Among planned projects are hospitals in Iskandar Puteri, Johor; Seberang Perai Central and Paya Terubong in Penang; and Kota Bharu, Kelantan. The group is also planning a healthcare facility near the Johor-Singapore Rapid Transit System corridor, which is expected to benefit from growing cross-border connectivity.
“We have all the land there already. So there’s nothing to hold us back,” Cheah said during the prospectus launch press conference yesterday.
He added that Sunway Healthcare is also exploring opportunities to expand beyond Malaysia, particularly within Asean, although no specific timeline has been set. “We are now also looking elsewhere outside Malaysia to establish hospitals and healthcare centres, most probably in the Asean region.”
President Datuk Lau Beng Long said the group’s priority remains strengthening its domestic presence, noting that several key states remain underserved. “Our dream is to ensure that we have hospitals in all major states in Malaysia. That is still our current focus, although we remain open to opportunities abroad.”
Sunway Healthcare currently operates five hospitals built over the past 25 years through an organic growth model, which the group said enables better cost control and operational efficiency.
Lau noted that the cost of building new hospitals typically ranges from RM1.5 million to RM2 million per bed, significantly lower than acquisition costs of RM5 million to RM6 million per bed.
The group is benefiting from rising medical tourism, with foreign patient revenue recording a compound annual growth rate of about 30% in recent years. Indonesia remains its largest source of international patients, while Cambodia has emerged as a fast-growing market.
On a separate issue, Cheah clarified that Sunway Bhd’s proposed takeover of IJM Corporation Bhd remains entirely voluntary, with shareholders free to accept or reject the offer.
He stressed that the offer was made in compliance with regulatory requirements and there is no obligation for shareholders to participate. “If they sell to us, fine. If they don’t sell, we walk away. There’s no compulsion.”
He added that the offer reflects Sunway’s assessment of IJM as a strategically attractive company.
“We find that it’s an attractive vehicle to have. So we made an offer according to the rules and regulations. It’s a willing buyer, willing seller situation,” he said.
Sunway in January announced the takeover offer for IJM at RM3.15 per share, primarily through a share-swap arrangement, in a deal valued at about RM11 billion.
IJM is a diversified infrastructure and property group with operations spanning construction, property development, infrastructure concessions and industrial manufacturing. Its assets include major highways such as the West Coast Expressway, New Pantai Expressway, Besraya and Lekas.
The proposed acquisition is expected to enhance Sunway’s scale and strengthen its presence in infrastructure and construction, complementing its existing property and township development businesses.
The takeover offer is subject to shareholder acceptance, with a closing date set for April 6. An independent adviser’s report assessing whether the offer is fair and reasonable is expected by March 16.
Major shareholders in IJM include the Employees Provident Fund, Amanah Saham Nasional Bhd and Kumpulan Wang Persaraan.
Cheah said Sunway will proceed based on shareholder response, emphasising that the group remains disciplined in its strategic investments.
The IPO of Sunway Healthcare marks a key milestone for the group as it expands its healthcare footprint while Sunway continues to pursue broader growth opportunities across its core businesses.
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