Ayala Corp. Targets $2B Valuation for AC Health, Aiming for a Fourfold Increase

Ayala Corp. —controlled by billionaire Jaime Zobel de Ayala along with his clan —plans to expand its healthcare initiative, AC Health, into the corporation’s next unicorn, aiming for an equity valuation of $2 billion by 2035, which would be roughly quadruple its present worth.

To achieve this, the company plans to keep growing its network of hospitals, clinics, and pharmacies via organic expansion as well as purchases in major urban areas throughout the Philippines, according to AC Health CEO and President Paulo Borromeo.

"We are committed to developing a lasting healthcare organization," Borromeo, who has led the startup since its inception in 2015, stated. CryptonesiaAsia During Ayala Corp.’s media briefing last week, it was mentioned that AC Health possesses sufficient funds to support its growth strategies over the coming two to three years. However, they will require extra capital for acquiring hospitals, as stated by him.

Currently, AC Health makes up 4% of Ayala Corp.'s net asset value (NAV), as stated by Borromeo. This equates to approximately 29 billion pesos ($515 million), considering Ayala's NAV was 726 billion pesos at the close of 2024.

One of the initiatives launched and developed by Jaime Augusto Zobel de Ayala along with his sibling Fernando is AC Health. Since they assumed control of Ayala Corp. from their father Jaime in 2006, this healthcare enterprise has been added to the roster of thriving startups founded by them, including mobile service provider Globe Telecom; Mynt, the operator behind fintech platform GCash worth around $5 billion; and massive renewable energy firm ACEN. Additionally, under the leadership of Ayala Corp., significant efforts have been directed toward entering the market for electric and hybrid vehicles via AC Mobility.

The president and CEO of Ayala Corp., Bong Consing, mentioned that the corporation has invested approximately 15 billion pesos in AC Health since its inception in 2015. He noted rapid expansion over the last couple of years, citing initiatives such as an oncology center. Consing anticipates that AC Health will achieve profitability shortly due to scaling operations to accommodate growing demand for high-quality health care services and medications.

AC Health saw its group revenue climb by 10%, reaching 9.4 billion pesos in 2024. This surge was driven by their clinics and hospitals achieving a remarkable 22% boost, as reported through a stock exchange submission. However, despite this upward trend in overall sales, the firm experienced a larger loss totaling 610 million pesos, attributed mainly to write-downs associated with the digital health platform KonsultaMD along with increased expenses for establishing a new oncology facility.

Borromeo stated that apart from the initial expenses for the cancer hospital, AC Health has maintained a positive core net income since 2023. He also mentioned that the firm achieved EBITDA positivity starting in 2021.

Starting with an initial investment in Generika Drugstore ten years ago, Borromeo has amassed a collection of 880 pharmacies via two pharmaceutical firms, which include two authorized medicine distributors for more than 1,178 drugs. Additionally, AC Health encompasses a system of 236 corporate and specialized medical centers along with six hospitals managed by Healthway Medical.

Borromeo aims to grow AC Health’s presence to include 1,150 retail pharmacies, 300 clinics, and 10 hospitals within the coming three years. He also notes that there remain opportunities for hospital acquisitions despite the recent moves made by competing corporate giants in the healthcare sector.

AC Health's growth has been overshadowed by the Metro Pacific Investments Corporation, headed by businessman Manuel Pangilinan. This corporation has taken over several hospitals, becoming the nation’s largest hospital operator with 27 facilities under its management. Meanwhile, Mount Grace Hospitals, operated by the wealthy Campos family, expanded quickly as well during this time, boasting the second-largest network comprising 24 establishments. Additionally, the Campos clan controls Unilab, the leading domestic pharmaceutical producer in the country, along with Del Monte Pacific, an entity involved in foods, beverages, and sauce products.

Borromeo remains unperturbed by the competitive landscape as AC Health has established an extensive network of healthcare facilities and pharmacies complemented by a digital platform designed to capitalize on emerging opportunities within the sector. "We really started gaining traction just over the past four or five years," Borromeo stated. "This growth accelerated following the pandemic. In our initial five-year period, we were still testing various approaches—pharmacies and diagnostic centers among them. We didn’t embark on significant acquisition efforts until 2019 when things became considerably more strategic."

Ayala Corporation stands as the nation’s most venerable diversified holding firm, founded by the progenitor of Jaime Zobel de Ayala, the matriarch or patriarch of the family, back in 1834 when they initially operated a distillery business. Nowadays, this publicly traded entity listed in Manila has broadened its reach across sectors including banking, energy, logistics, utilities, and property development. The clan boasts an estimated wealth totaling $2.6 billion, making them one of the wealthiest families in the Philippines.