IFC, a member of the World Bank Group, and IFHA-II Coöperatief U.A, a private equity fund focused on health care in Sub-Saharan Africa, have launched a $115m (Sh11.7b) holding company to acquire and integrate targeted health care service businesses in East and Southern Africa.
The project will boost access to quality health care services to help improve lives and achieve universal health coverage across the region.
IFC is investing $22m (Sh2.25b) in the Hospital Holdings Investment (HHI) holding company, an investment platform set up by IFHA-II, which is also supported by the European development finance organizations Swedfund, Proparco, Finnfund and IFU, Danish Investment Fund for Developing countries. HHI will be IFC’s largest equity investment in health care in Sub-Saharan Africa, outside of South Africa. IFC also mobilized $43.2m (Sh4.4b) from other investors.
“HHI is filling a critical gap in the health care sector by providing secondary and out-of-hospital care for middle to lower middle income patients in East and Southern Africa. We aim to offer accessible, affordable and quality health care by increasing the number of hospitals and clinics we operate,” said Max Coppoolse, chairman of the Board of HHI and managing partner at IFHA-II.
HHI is expected to grow services in East and Southern Africa from one hospital and 35 clinics to five hospitals and 52 clinics, serving up to 1.8 million patients annually over the next five years. This will be achieved both by building new facilities and acquiring existing health care assets.
“Access to quality and affordable healthcare is essential for building the human capital that economies need to promote growth,” said Stephanie von Friedeburg, IFC’s Chief Operating Officer, during a signing event on the sidelines of the Investment for Africa Forum in Cairo. “Private investment in the health sector in Africa—like the agreement we signed today with IFHA-II—is a key strategy for competitiveness and growth.”
IFC is the largest multilateral investor in health care in developing countries, with investments in over 200 projects in the past two decades totaling $4.3 billion.