New Frontier Capital Management Hong Kong has partnered to raise a Middle East and North Africa healthcare fund.
The Blue Apple New Frontier Healthcare fund was jointly established on Monday with Blue Apple Partners, an Abu Dhabi-based investment manager.
The private equity fund hopes to raise $300m from investors in Asia, the Middle East, Europe and the US by the end of the year. This includes high-net-worth individuals, family offices and corporates, a New Frontier spokesperson told Citywire Asia.
It will focus on opportunities around hospitals, medical infrastructure, medical systems, health technology and health promotion with a $10m to $150m price tag, the spokesperson said.
Most of the fund’s investments will be in Abu Dhabi, given Blue Apple’s network in the city. The firm was established by Zaid Al Siksek, former CEO of the Health Authority Abu Dhabi and investment professional Mansur Ali in 2012.
It has partnered with alternative investment manager Investcorp and healthcare operator VAMED to build a hospital complex on Abu Dhabi’s Reem Island.
New Frontier said the fund will concentrate on a ‘promising sector of growth’. It noted that UAE’s medical and healthcare market is set to post a compound annual growth rate of 8.5% until 2023.
‘At a time of a global crisis resulting from Covid-19, we believe that promoting investment in the medical and healthcare sector in MENA further underscores the social significance of the fund,’ it said.
The fund will also invest in the secondary markets of Saudi Arabia and Egypt, although a pipeline for the latter is still being established, Citywire Asia understands.
Meanwhile, it will be jointly managed by representatives from Blue Apple and New Frontier, that includes one of Blue Apple’s co-founders and New Frontier CEO Shigeki Usuki.
The fund targets a 25% gross internal rate of return over seven years, with a possiblity of a three-year extension, the New Frontier spokesperson said.
Japanese companies who wish to enter the MENA market are one of the its target groups. ‘We would like to have a Japan angle and a global angle to this fund.
‘I believe there is some presence from Japanese companies already. They can use this fund as a platform to enter and collaborate with the UAE and MENA healthcare market,’ the spokesperson added.
Other private equity funds are also gunning for the Japanese buy-in. Singapore-based Chartered Group launched a fund that will primarily invest in Israeli technology in April.
Japan Israel High Tech Ventures 2 LP hopes to raise $500m in capital commitments from Japanese companies with limited access to the market.