Quek Leng Chan, TPG-backed Asia OneHealthcare targets RM7 billion Malaysia IPO in Q1 2027

[KUALA LUMPUR] Asia OneHealthcare (A1Health) is looking to raise about RM7 billion to RM7.5 billion (around US$1.7 billion to US$1.9 billion) in a Malaysian initial public offering sometime in the first quarter of 2027, a source familiar with the plans told The Business Times.

The company is backed by Malaysian tycoon Quek Leng Chan’s Hong Leong Group and US private equity giant TPG. It is looking to roll out its IPO documentation in November this year, with the offering expected to value the hospital operator at about RM30 billion, BT understands.

According to the source, hospital IPOs remain an attractive exit route for private equity firms as the underlying story is easy for investors to grasp: people are getting richer, populations are ageing and demand for private healthcare continues to grow.

He added that even as artificial intelligence soaks up much of the market’s attention, hospitals remain one of the few sectors still basking in strong investor interest. “Right now, markets are obsessed with AI and a lot of other sectors are struggling for attention,” he said, adding: “Hospitals are one of the few exceptions.”

Bloomberg reported on Thursday (Sep 3) that the hospital operator had submitted a draft registration to the Securities Commission Malaysia more than a week ago for an IPO.

Biggest-ever healthcare listing

If market conditions hold, A1Health could rank among Malaysia’s biggest-ever healthcare listings. Its roughly RM7 billion offering would surpass IHH Healthcare ’s RM6.3 billion blockbuster IPO in 2012 and dwarf the size of Sunway Healthcare’s RM2.9 billion base offering earlier this year.

The two listed hospital groups’ current valuations offer a glimpse of what investors are willing to pay for healthcare assets.

IHH, which listed in Kuala Lumpur and Singapore, came to market at a valuation of about RM23 billion in 2012 and is now worth roughly RM70 billion. Sunway Healthcare has enjoyed a similar rerating – it debuted at a valuation of RM16.7 billion in March and is now worth about RM24 billion based on last Friday’s close.

Malaysia’s healthcare sector continues to draw plenty of M&A action. Last Friday, KKR became the latest investor to pile in, agreeing to take a minority stake in Avisena Healthcare, which runs private hospitals in Shah Alam and Cyberjaya. It is targeting 404 beds by 2027 and 600 by 2029.

While the terms were not disclosed, Reuters reported in August that the deal could involve a 20 to 25 per cent stake worth RM300 million to RM400 million. 

Team Hong Leong-TPG

A1Health, formerly known as Columbia Asia Healthcare, is a regional private hospital group with 23 hospitals across Malaysia and Vietnam and more than 1,300 consultants. It has become one of the region’s largest private hospital platforms through a series of acquisitions.

Hong Leong made its first big healthcare bet in 2019, teaming up with seasoned healthcare investor TPG to buy Columbia Asia’s South-east Asian hospital business for about US$1.2 billion. The pair beat rivals including Sime Darby and US investment firm General Atlantic to the deal.

The deal gave them 17 hospitals and one clinic across Malaysia, Indonesia and Vietnam, while Columbia Asia’s Indian business stayed out of the transaction.

From there, they went on a buying spree. The biggest splash came with the RM5.7 billion acquisition of Ramsay Sime Darby Health Care and the consolidation of five specialist hospitals from TE Asia Healthcare – TPG’s sponsored healthcare platform.

In 2024, the enlarged platform was brought together under the Asia OneHealthcare name, which also counted Malaysia’s Employees Provident Fund and a unit of the Abu Dhabi Investment Authority among its investors.

The listing would add another public-market asset to Quek’s sprawling business empire, which spans banking, property, manufacturing and investments across Malaysia and the region.

Rich valuations

A1Health’s IPO would add another burst of activity to Malaysia’s already busy healthcare dealmaking scene.

Hong Leong Investment Bank said earlier this year that a string of big-ticket listings, including Sunway Healthcare and A1Health, could give Malaysia’s healthcare sector a broader rerating by setting new valuation benchmarks and drawing in fresh capital from global funds.

It also pointed to Malaysia’s ageing population and a fast-growing medical tourism business, where revenue grew at a 7.3 per cent compound annual rate between 2019 and 2023, ahead of Thailand’s 5.1 per cent and Singapore’s 0.4 per cent.

Malaysia is also aiming for RM12 billion in healthcare revenue by 2030 under its Malaysia Year of Medical Tourism 2026 campaign.

While the sector remains hot, it remains to be seen how A1Health’s offering will play out amid an already rich valuation cycle.

For one, some of the exuberance appears to be fading. HLIB downgraded the sector to “neutral” in July, saying the IPO-led rerating has already largely materialised.

Kenanga Research pointed out that private healthcare valuations were looking rich relative to earnings growth. Its latest note in August put IHH’s FY2026 enterprise value-to-Ebitda multiple at about 15 times, versus more than 38 times for Sunway Healthcare, although Sunway also carries the stronger growth story. Ebitda refers to earnings before interest, taxes, depreciation, and amortisation.

It’s all about timing

For US private equity giant TPG, which has built a sizeable healthcare portfolio across Asia, the proposed flotation also comes during a period of active monetisation of its Indian healthcare portfolio.

In August, TPG was involved in the nearly US$1 billion IPO of Bengaluru-based Manipal Health Enterprises, which is backed by Singapore’s Temasek Holdings. In the same month, TPG pared stakes in eye-care operator Dr Agarwal’s Health Care, while another vehicle cut its stake in Aster DM Quality Care later in the month.

The source said the key question is whether markets remain as receptive when the company eventually launches its offering in early 2027. One big test is whether, by the time A1Health comes to market, investors will still be willing to pay the price it wants.

Increasingly, global investor liquidity is being absorbed by technology and artificial intelligence-related offerings, while broader market volatility could affect appetite for a sizeable Malaysian listing.

Domestic factors could also have a bearing on fund flows, chiefly political uncertainty surrounding the timing of Malaysia’s next general election.