Philippines’ Ayala Corp. Aims To Quadruple AC Health’s Valuation To $2 Billion

Ayala Corp.—controlled by billionaire Jaime Zobel de Ayala and his family—is scaling up its healthcare venture AC Health into the conglomerate’s next unicorn with $2 billion in equity valuation by 2035 about four times its current value.

To get there, the venture will continue to expand its network of hospitals, clinics and drugstores both organically and through acquisitions in key cities across the Philippines, AC Health CEO and President Paulo Borromeo said.

“We are building a healthcare group for the long term,” Borromeo, who has helmed the startup since it began 2015, told Forbes Asia on the sidelines of Ayala Corp.’s media briefing last week. AC Health has capital to bankroll its expansion plans in the next two to three years but would need additional equity from potential investors for hospital acquisitions, he said.

AC Health currently accounts for 4% of Ayala Corp.’s net asset value (NAV), according to Borromeo. That’s about 29 billion pesos ($515 million) based on Ayala’s NAV of 726 billion pesos as of end-2024.

AC Health is one of the ventures started and built-up by Jaime Augusto Zobel de Ayala and brother Fernando, since taking the helm of Ayala Corp. from their father Jaime in 2006. The healthcare company has joined the list of the brothers successful start-ups that includes mobile carrier Globe Telecom; Mynt, operator of fintech GCash, which is valued at $5 billion; and renewable energy behemoth ACEN. Ayala Corp. is also making a push into electric and hybrid vehicles through AC Mobility.

Ayala Corp. president and CEO Bong Consing said the conglomerate has poured about 15 billion pesos into AC Health since it started in 2015, and has expanded rapidly in the past two years with projects including an oncology center. Consing expects AC Health to become profitable soon as the company has already scaled up to meet increasing demand for quality healthcare services and medicine.

AC Health’s group revenue rose 10% to 9.4 billion pesos in 2024 with its clinics and hospitals delivering an industry-beating 22% increase, according to a stock exchange filing. Despite the topline growth, the company booked a wider 610 million loss due to asset impairment charges related to online doctor consultation app KonsultaMD and ramp-up costs of the new cancer hospital.

Excluding the start-up cost of the cancer hospital, AC Health has been core net income positive since 2023, Borromeo said, adding the company has been EBITDA positive since 2021.

From an investment in Generika Drugstore a decade ago, Borromeo has put together a portfolio of 880 drugstores through two pharmaceutical companies including two drug importers licensed to distribute over 1,178 medicines. AC Health also includes a network of 236 corporate and multi-specialty clinics and six hospitals under Healthway Medical.

Borromeo plans to expand AC Health’s footprint to 1,150 retail pharmacies, 300 clinics and 10 hospitals in the next three years. There are still hospitals ripe for acquisitions even after the purchases by rival conglomerates that have moved ahead in healthcare, he adds.

AC Health’s expansion has been eclipsed by tycoon Manuel Pangilinan-led Metro Pacific Investments Corp., which has acquired a series of hospitals making it the country’s medical center operator with 27 facilities. Mount Grace Hospitals, which runs the second-biggest network with 24 facilities and led by the billionaire Campos family, also grew rapidly in the same period. The Campos family also control Unilab, the country’s biggest home-grown drug maker; and food, beverage and sauces company Del Monte Pacific.

Borromeo is unfazed by competition as AC Health has built a netwok of healthcare facilities and pharmacies alongside a digital platform that’s geared to take advantage of opportunities in the industry. “The momentum picked up a lot only in the last four or five years,” Borromeo said. “It spiralled up after the pandemic. For the first five years we were still experimenting here and there: pharmacies and diagnostic clinics. It was in 2019 that we began a series of acquisitions that were more meaningful.”

Ayala Corp. is the country’s oldest conglomerate that was started by the grandfather of Jaime Zobel de Ayala, the family patriarch, in 1834 as a distillery. Today, the Manila-listed company has expanded into banking, energy, logistics, utilities and real estate. With a net worth of $2.6 billion, the family is among the richest in the Philippines.