Novena Global headed for Taiwan listing to raise US$150m

Singapore

SINGAPORE-BASED Novena Global Lifecare Group (Novena) plans to list on the Taipei Exchange (TPEx) as part of its plan to expand regionally to meet buoyant demand from "affluent Asians to stay healthy and look young", it said on Monday.

The group wants to raise US$150 million (S$203.58 million) in an initial public offering (IPO) and use the funds to grow organically and through acquisitions.This makes Novena the fourth Singapore-based healthcare-related firm in the last four months with intentions to take its IPO outside the Republic.

The other three are ASLAN Pharmaceuticals, a Singapore-based biotechnology company focused on the development of immunotherapies for Asia prevalent tumour types; Tessa Therapeutics (Tessa), a clinical-stage biotechnology company focused on the development and commercialisation of cancer immunotherapies; and CellResearch Corporation (CellResearchCorp), a biotech firm specialising in stem cell research aimed at wound treatments.

ASLAN successfully raised US$33 millionthrough an initial public offering on the TPEx, valuing the company at US$300 million in late May.

Tessa is looking for about US$100 million in extra funding later in the year, and is planning to go for an initial public offering in NASDAQ over the next 12 to 18 months, while CellResearchCorp also has its sights on a Nasdaq listing by 2019.

With strong growth seen in Taiwan, China and South-east Asia, Novena is looking to target business in three areas: preventative care through health screenings, nutrition and supplements; predictive care through DNA testing to identify potential susceptibilities to illness; and rejuvenative care through providing aesthetic medical services.

The group currently has more than 100 clinics across Singapore, China, Hong Kong, Taiwan, Korea, Indonesia, India and Malaysia; and a track record of over six million procedures performed and more than two million patients in its international patient database.

Its executive chairman and co-founder Nelson Loh said: "We believe we have a very scalable business model to support our growth plans. Going by trends in the more developed markets of Singapore, Taiwan and South Korea, we see huge potential in China and some of the emerging economies for healthcare services that help people to stay good on the inside and look great on the outside."

Founded six years ago by cousins and former investment bankers Nelson and Terence Loh, Novena is the largest medical aesthetic chain in Singapore, with 15 clinics and a database of over 150,000 patients.

It is also the only Singapore medical aesthetic chain with its own research and development (R&D) and manufacturing arm in Korea.

"Our chain of clinics has a strong track record for treating Asian clients, and our integrated business model supports our services and products through R&D, and through manufacturing of specialised high quality machines," said Mr Loh.

He added that with rising disposable incomes of Asia's middle class bolstering demand for medical healthcare and aesthetic services and products, the company expects sales to double in the coming years.

Group revenue currently stands at US$50 million with net profit margin at 20 per cent.

Statistics from the Institute on Asian Consumer Insight showed that the Asian beauty and personal care market will grow from US$150 billion to US$170 billion by 2019, or over one-third of the global market. The middle-income class in Asia alone is projected to increase from 500 million in 2009 to 3.2 billion in 2020.

Globally, the non-surgical facial aesthetic market is estimated to grow at a compound annual growth rate (CAGR) of 12 per cent from US$2.5 billion in 2013 to US$5.4 billion in 2020, with Asia accounting for the bulk of growth.

"We believe we are in a sweet spot for consumer health and wellness and in a region where people want to take responsible actions for their own health. Advances in technology and big data have made it possible to predict diseases with a high level of accuracy, enabling healthcare to be personalised and preventive measures to be taken, leading ultimately to better quality of life and lower medical costs," Novena's CEO and co-founder Terence Loh said.

Currently, medical aesthetics is the largest contributor to the group's revenue but Novena expects their predictive care business to overtake that in the coming years.

In Taiwan, the group has acquired a majority stake in Hexin, an established provider of health screening services which has outsourced the management of these services in their three hospitals to Novena.

Novena also plans to further develop predictive care through DNA testing with its partnership with another Taiwanese company, Health GeneTech. It will also work with leading universities and regional labs in Taiwan, Korea, India and Hong Kong to develop an extensive database on Asian genetics for predictive developmental and healthcare management.

In addition, the group is in talks with a Taiwanese company to develop a maternity care centre as it sees a growing market for post-natal care and anti-aging treatments in Singapore.

Plans are also afoot to convert the group's Novena Gardens into a tertiary medical centre, offering a suite of services including an anti-aging centre and medical serviced apartments for patients.