
Quadria backs Indonesia's Hermina Hospitals

Singapore’s Quadria Capital has paid an undisclosed sum for a minority stake in Hermina Hospitals, one of the largest hospital chains in Indonesia.
Shares in the Jakarta-listed company began a sharp climb on March 15, rising from IDR4,360 to as high as IDR4,800 by the time the investment was announced on March 22. The stock last closed on that date at IDR4,670, giving the company a market capitalization of IDR13.9 trillion ($967 million).
It marks the fourth investment from Quadria’s second healthcare-focused fund, which closed at $595 million last year and writes checks of up to $200 million, including co-investment, across South and Southeast Asia. Previous investments include India’s Asian Institute of Gastroenterology and AKUMS Drugs & Pharmaceuticals.
“We are impressed by the vision of Hermina’s founders as pioneers of affordable private healthcare in Indonesia; we are even more impressed by their ability to realize that vision at significant scale,” Abrar Mir, a managing partner and co-founder of Quadria, said in a statement. “We are excited to work alongside the founders and a stellar management team to transform Hermina into a leading tertiary care provider in the region.”
Founded in 1985, Hermina focuses on an emerging middle-class market with core expertise in mother-and-child care. Operations include 41 general hospitals with more than 5,000 beds across 26 Indonesian cities. The chain employs more than 3,800 doctors and specialists, who care for more than six million outpatients and 375,000 inpatient admissions annually.
As recently as 2017, Hermina’s footprint included only 25 hospitals and 2,600 beds. That year, the company received a $45 million investment from local private equity firm Creador. Hermina raised about IDR1.3 trillion in its IPO in 2018, facilitating an exit for Creador. The GP retains representation on Hermina’s board of commissioners and investment committee.
Hermina said it expects to leverage Quadria’s expertise and network in the broader healthcare space, having identified operational growth areas such as serving “higher intensity cases” and ESG development. Asian Development Bank, one of Creador’s LPs, has previously noted that it classifies Hermina as a “gender equity” asset because it improves women’s access to quality healthcare.
The hospital chain’s most recent annual report charted an 18% increase in revenue during 2019 to IDR3.6 trillion. Net income increased 80% during the period to IDR344 billion, with the company reporting a rapid portfolio expansion, including several recently delivered and under-construction hospitals.
Quadria had expected hospitals to represent a relatively subdued facet of its portfolio, when it closed its latest fund last year during the early stages of the regional COVID-19 outbreak. Expectations of lower footfall appear to have been dismissed, however, with Amit Varma, a co-founder at Quadria, flagging plans to transform Hermina into Indonesia’s largest multi-specialist care network.
In addition to Asian Institute of Gastroenterology, Quadria’s previous investments in this space include Singapore’s Heart, Stroke & Cancer Centre and MWH Holdings, as well as Indian chains Medica Superspeciality Hospital, Healthcare Global Enterprises, and Krishna Institute of Medical Science.
In 2017, the private equity firm backed Vietnam’s FV Hospital, which operates a 220-bed facility employing 130 doctors in Ho Chi Minh City.
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