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The National
10-03-2025
- Business
- The National
Talabat-instashop deal may spur more industry mergers
Talabat's acquisition of Dubai-based platform instashop last week could be a catalyst for more consolidation in the food and grocery delivery industry, as more and more platforms turn into super apps, industry analysts say. However, potential challenges on competition and job security are also likely in the industry, in addition to the effects consolidation would have on fair consumer pricing. UAE-based talabat bought instashop from German parent company Delivery Hero for $32 million, boosting its grocery and retail portfolio in the Emirates and Egypt, and bringing its pro forma grocery and retail gross market value for last year to more than $2.5 billion. That could bring more momentum to the consolidation trend, with companies seeking economies of scale, expanding their customer base and enhancing operational efficiency in an increasingly competitive market, said Olivier Tricou, managing director of Dubai-based consultancy Alpen Capital. "More mergers and acquisitions are likely to happen, as companies seek to strengthen their market positions and diversify their services," he told The National. Talabat's acquisition of instashop looks set to "accelerate market consolidation in the Mena delivery sector", agreed Salem Al Remeithi, chief executive of SHR Capital. "This strategic move creates a more powerful integrated platform with expanded service offerings, putting pressure on competitors to pursue similar strategies," he told The National. "Smaller players may struggle to compete independently against such comprehensive delivery ecosystems, driving them toward mergers or acquisitions to remain viable ... further concentrating market power among fewer, larger entities." While talabat and instashop are eventually subsidiaries of the same holding company, Delivery Hero, analysts touted the deal as a "significant" one, given the potential to serve more customers at scale in a region increasingly dependent on technology platforms. The deal will enable talabat to tap into instashop's grocery and retail portfolio, potentially improving service efficiency through integrated logistics networks and shared technology, Mr Al Remeithi said. "This one-stop solution approach enhances user experience while possibly leveraging economies of scale for competitive pricing," he said. "The deal could intensify competition in the regional delivery market, likely driving innovation as competitors respond to talabat's expanded capabilities." Talabat is among a number of players in the UAE catering to the key on-demand food and quick-commerce markets, as more consumers and businesses rely on convenience and choice. Its major rivals include Careem, noon and deliveroo, which provide access to a mix of food, grocery, ride-hailing, medicines, home services and payments. They are all expanding their offering as part of efforts to become super apps, or applications that provide one-stop services across different segments. "The industry's evolution into a multi-service ecosystem, incorporating food, groceries, mobility and payment solutions, reflects a growing consumer demand for convenience," said Sumesh Krishna, a senior partner at Dubai-based tax advisory HLB Hamt. Online business channels, including food aggregators and last-mile delivery platforms, are poised to play a 'pivotal role' in reshaping the dynamics of the Gulf's food market, Alpen Capital said in a previous report. The online food delivery market in the UAE is expected to hit nearly $1.14 billion in 2025 and grow at a compound annual rate of 14 per cent to $1.3 billion by 2029, data by Statista shows. Globally, the sector is expected to reach a value of more than $257 billion this year, and rise roughly 150 per cent to about $637 billion by 2034, according to India-based Precedence Research. The industry is currently in "a quite mature stage", having received a boost during the pandemic which "radically" shifted consumer habits, said Alexander Ponomarev, chief executive of Syrve MENA, a restaurant technology service provider based in Dubai. "Since people have built the habits of buying things online, they are now used to getting their food and groceries online as well." One of the main challenges for industry operators currently is the allocation of the workforce within the demand schedule, which is distributed "quite unevenly" across the day, said Mr Ponomarev. "This leads to increased load during peak hours and hours of idle time when the demand is low. The delivery services aiming to utilise the work hours efficiently are attempting to stretch it to the grocery purchases, which usually happen during different time slots in comparison to the prepared food," he told The National. However, the talabat-instashop deal may have a "mixed effect" on the gig economy workforce: the merger might accelerate technological integration, potentially altering job quality and quantity, possibly cutting jobs, Mr Al Remeithi said. "The impact will vary across markets, with densely populated urban areas likely seeing the most significant changes. Overall, while job numbers might decrease initially, the long-term effect depends on how the merged entity balances efficiency gains against workforce expansion and market share gains," he said. Another challenge is the actual ability of these companies to lower prices: while the talabat-instashop deal aims to boost operational efficiency and may result in better service, decreased pricing is unlikely "as the main cost generating factor here is still the grocery assortment itself", said Mr Ponomarev. "The pricing has been galloping over the last few years for various reasons globally. Still, enjoying a better service in a market reality that has been formed and maintained is great."Moves by players to increasingly acquire niche platforms to widen market reach may also lead to fewer choices and stifle innovation in the long run, Mr Krishna said. "The sector is expected to thrive as digital adoption rises, with investments in artificial intelligence, automation and innovative solutions like drone deliveries," he told The National. "Although these advancements promise improved service quality and broader offerings, careful attention is needed to ensure that competition fosters continuous innovation and fair consumer pricing." Consolidation may lead to fewer service providers, but larger companies can offer more reliable services and competitive pricing due to increased efficiency, said Mr Tricou. Looking ahead, the industry is being led by technological advancements and changing consumer preferences for convenience, with the emergence of super apps offering diverse services, and the data monetisation linked to it, he said. "The shift towards super apps integrating services like food delivery, transportation, and payments is a significant trend, as seen with platforms like Careem. Demand is expected to grow, with companies exploring tech solutions. Drones can enhance delivery efficiency, even if drone delivery is heavily linked to regulatory approval," he added.
Arabian Business
22-02-2025
- Business
- Arabian Business
GCC healthcare spending to hit $159bn by 2029; Saudi and UAE lead growth as hospital beds to pass 140,500
Current Healthcare Expenditure (CHE) in the GCC will reach $159bn by 2029, according to forecasts by Alpen Capital. It implies an annualised growth rate of 7.8 per cent and CHE in the GCC is anticipated to increase at growth rates ranging from 4 per cent to 8.8 per cent. UAE-based investment banking advisory firm, Alpen Capital, launched its latest GCC Healthcare Industry report which features forecasts on the sector, recent analysis on trends, growth drivers and challenges facing the segment. GCC healthcare spending Sameena Ahmad, Managing Director of Alpen Capital, said: 'The GCC healthcare industry is poised for strong growth driven by macro-economic factors, a growing and ageing population, and the expansion of mandatory health insurance. 'Government-led diversification strategies and national development plans of the GCC will continue to enhance the healthcare infrastructure and facilities, bringing them at par with international standards. 'Further growth of the healthcare industry will be fuelled by privatisation initiatives, substantial investments in digital transformation and rising demand for specialised healthcare services. 'Looking ahead, we expect the sector to offer innovative opportunities for investors and operators to expand their presence and deliver advanced, high quality healthcare services'. Olivier Tricou, Managing Director, Alpen Capital, said: 'The GCC healthcare industry is experiencing significant transformation, driven by a growing demand for specialized medical centres and increasing medical tourism. 'In response, private sector players are investing heavily to expand healthcare services and meet the needs of a diverse population. Key trends shaping the industry include the rapid adoption of artificial intelligence and digitalisation, which are enhancing diagnostics, patient care, and operational efficiency. 'Additionally, there is a notable increase in specialised clinics to address complex medical conditions and cater to specific patient demographics. To remain competitive, healthcare organisations are developing strategic plans that leverage technology and multi-specialty services. 'This ongoing transformation is expected to drive a dynamic M&A landscape, as operators seek to scale, innovate, and align with the region's evolving healthcare demands'. According to Alpen Capital, CHE in the GCC is expected to grow from an estimated $109.1bn in 2024 to $159bn in 2029, at a CAGR of 7.8 per cent. The region's expanding population base, high incidence of NCDs, rising cost of treatment and medical inflation, coupled with increasing penetration of health insurance are expected to drive growth. CHE as a proportion of GDP in the GCC is anticipated to grow from 5 per cent in 2024 to 5.7 per cent in 2029. The growth varies widely among the GCC nations largely owing to country-specific population projections, economic conditions and cost of healthcare among other factors. Saudi Arabia is likely to witness the highest growth rate at 8.8 per cent, whereas the UAE's healthcare industry is expected to grow at a CAGR of 6.7 per cent during the forecast period. The market rankings are expected to remain unchanged, with Saudi Arabia and the UAE dominating the region's CHE with a combined share of 82.6 per cent by 2029. CHE of Qatar, Kuwait, Bahrain and Oman is expected to grow at CAGRs of 8.3 per cent, 6.3 per cent, 6 per cent and 4 per cent, respectively between 2024-2029. The report forecasts that the region is likely to require 12,317 new hospital beds between 2024 and 2029. This translates into an estimated annual average growth of 1.9 per cent since 2024 to reach a collective bed capacity of 140,572. Majority of the new additions are expected to be driven by the private sector as the GCC governments have started focusing on privatization to reduce cost burden and increase standard of care. Saudi Arabia is likely to witness the highest demand for beds in the GCC at over 8,500 new beds, accounting for 69 per cent of the region's total additions during the forecast period. The report highlights that economic growth, coupled with the governments' focus on economic diversification, is expected to drive healthcare investments in infrastructure and human capital development. Key demographic trends – such as population growth, increasing life expectancy at birth, and improvements in infant mortality rate– are shaping the regions' healthcare demand. Notably, the proportion of population over 50 years is projected to increase from 12.7 per cent in 2024 to 13.8 per cent in 2029, further intensifying the demand for specialised healthcare services. Additionally, the expansion of health insurance coverage and the rise in medical tourism are expected to boost the utilisation of private hospitals and healthcare services. Despite these strong growth drivers, the GCC's healthcare sector faces several challenges. The industry remains highly reliant on foreign healthcare professionals across specialties. There also remains a gap in supply of specialised care units in the tertiary care segment, contributing to rising outbound medical tourism. Moreover, the cost of healthcare services continues to rise due to high prevalence of non-communicable diseases (NCDs), increasing demand for advanced treatments, dependence on imported medical supplies, and a shortage of specialised treatment centres. In response, the GCC governments are actively promoting privatisation through public-private partnership (PPP) models to increase quality and efficiency of care. Significant investments in digital transformation aim to integrate innovative technologies for better healthcare outcomes. Another key trend, precision medicine and genomics are gaining traction with a goal of developing targeted treatments and therapies. Additionally, the rising demand for specialised and complex treatments is accelerating the establishment of Centres of Excellence (CoEs), long-term post-acute care (LTPAC) facilities and home healthcare services. As the sector continues to mature, PPPs are expected to bring about a shift in care delivery that will be pivotal in shaping the industry's landscape. With the GCC healthcare ecosystem becoming more digital and patient-centric, health-tech innovations present significant prospects for growth. Going forward, industry players are likely to focus on value-driven investments, with larger operators targeting smaller providers and tech-enabled healthcare firms to expand their service offerings.
Zawya
19-02-2025
- Business
- Zawya
GCC healthcare industry set for robust growth, forecasts Alpen Capital
Dubai – Alpen Capital's latest healthcare industry report for the GCC forecasts the Current Healthcare Expenditure (CHE) in the region to reach US$ 159 billion by 2029, implying an annualized growth rate of 7.8%. During the forecast period, CHE in the GCC countries is anticipated to increase at growth rates ranging from 4.0% to 8.8% UAE-based investment banking advisory firm, Alpen Capital, launched its latest GCC Healthcare Industry report which features forecasts on the sector, recent analysis on trends, growth drivers and challenges facing the segment. It also profiles some of the key healthcare companies in the region. The report was launched over a webinar followed by a panel discussion featuring Dr. Raza Siddiqui, Group CEO, Arabian Healthcare Group & Executive Director, RAK Hospitals; Dr. Mohaymen Abdelghany, Chief Executive Officer, Fakeeh University Hospital and Olivier Tricou, Managing Director, Alpen Capital. Hameed Noor Mohamed, Managing Director, Alpen Capital moderated the discussion ' The GCC healthcare industry is poised for strong growth driven by macro-economic factors, a growing and ageing population, and the expansion of mandatory health insurance. Government-led diversification strategies and national development plans of the GCC will continue to enhance the healthcare infrastructure and facilities, bringing them at par with international standards. Further growth of the healthcare industry will be fueled by privatization initiatives, substantial investments in digital transformation and rising demand for specialized healthcare services. Looking ahead, we expect the sector to offer innovative opportunities for investors and operators to expand their presence and deliver advanced, high quality healthcare services ', says Sameena Ahmad, Managing Director, Alpen Capital (ME) Limited. 'The GCC healthcare industry is experiencing significant transformation, driven by a growing demand for specialized medical centers and increasing medical tourism. In response, private sector players are investing heavily to expand healthcare services and meet the needs of a diverse population. Key trends shaping the industry include the rapid adoption of artificial intelligence and digitalization, which are enhancing diagnostics, patient care, and operational efficiency. Additionally, there is a notable increase in specialized clinics to address complex medical conditions and cater to specific patient demographics. To remain competitive, healthcare organizations are developing strategic plans that leverage technology and multi-specialty services. This ongoing transformation is expected to drive a dynamic M&A landscape, as operators seek to scale, innovate, and align with the region's evolving healthcare demands', says Olivier Tricou, Managing Director, Alpen Capital (ME) Limited. According to Alpen Capital, CHE in the GCC is expected to grow from an estimated US$ 109.1 billion in 2024 to US$ 159 billion in 2029, at a CAGR of 7.8%. The region's expanding population base, high incidence of NCDs, rising cost of treatment and medical inflation, coupled with increasing penetration of health insurance are expected to drive growth. CHE as a proportion of GDP in the GCC is anticipated to grow from 5.0% in 2024 to 5.7% in 2029. The growth varies widely among the GCC nations largely owing to country-specific population projections, economic conditions and cost of healthcare among other factors. Saudi Arabia is likely to witness the highest growth rate at 8.8%, whereas the UAE's healthcare industry is expected to grow at a CAGR of 6.7% during the forecast period. . The market rankings are expected to remain unchanged, with Saudi Arabia and the UAE dominating the region's CHE with a combined share of 82.6% by 2029. CHE of Qatar, Kuwait, Bahrain and Oman is expected to grow at CAGRs of 8.3%, 6.3%, 6.0% and 4.0%, respectively between 2024-2029. The report forecasts that the region is likely to require 12,317 new hospital beds between 2024 and 2029. This translates into an estimated annual average growth of 1.9% since 2024 to reach a collective bed capacity of 140,572. Majority of the new additions are expected to be driven by the private sector as the GCC governments have started focusing on privatization to reduce cost burden and increase standard of care. Saudi Arabia is likely to witness the highest demand for beds in the GCC at over 8,500 new beds, accounting for 69.0% of the region's total additions during the forecast period. The report highlights that economic growth, coupled with the governments' focus on economic diversification, is expected to drive healthcare investments in infrastructure and human capital development. Key demographic trends – such as population growth, increasing life expectancy at birth, and improvements in infant mortality rate– are shaping the regions' healthcare demand. Notably, the proportion of population over 50 years is projected to increase from 12.7% in 2024 to 13.8% in 2029, further intensifying the demand for specialized healthcare services. Additionally, the expansion of health insurance coverage and the rise in medical tourism are expected to boost the utilization of private hospitals and healthcare services. Despite these strong growth drivers, the GCC's healthcare sector faces several challenges. The industry remains highly reliant on foreign healthcare professionals across specialties. There also remains a gap in supply of specialized care units in the tertiary care segment, contributing to rising outbound medical tourism. Moreover, the cost of healthcare services continues to rise due to high prevalence of non-communicable diseases (NCDs), increasing demand for advanced treatments, dependence on imported medical supplies, and a shortage of specialized treatment centers. In response, the GCC governments are actively promoting privatization through public-private partnership (PPP) models to increase quality and efficiency of care. Significant investments in digital transformation aim to integrate innovative technologies for better healthcare outcomes. Another key trend, precision medicine and genomics are gaining traction with a goal of developing targeted treatments and therapies. Additionally, the rising demand for specialized and complex treatments is accelerating the establishment of Centers of Excellence (CoEs), long-term post-acute care (LTPAC) facilities and home healthcare services. As the sector continues to mature, PPPs are expected to bring about a shift in care delivery that will be pivotal in shaping the industry's landscape. With the GCC healthcare ecosystem becoming more digital and patient-centric, health-tech innovations present significant prospects for growth. Going forward, industry players are likely to focus on value-driven investments, with larger operators targeting smaller providers and tech-enabled healthcare firms to expand their service offerings. About Alpen Capital: Alpen Capital (ME) Limited is incorporated as a limited liability company in the Dubai International Financial Centre, Dubai, United Arab Emirates and is licensed by the Dubai Financial Services Authority. Alpen Capital offers a full range of investment banking advisory services in the areas of M & A, Debt, Equity and Capital Markets to some of the largest business conglomerates and financial institutions in the GCC and South Asia. It has offices in Abu Dhabi, Dubai, Doha, Muscat and New Delhi. About Alpen Asset Advisors: Alpen Asset Advisors Limited, is an independent wealth management firm offering private banking and asset management services. It offers a comprehensive offering covering all asset classes, investment themes & styles and sectors. With our open architecture platform we identify investment opportunities and design an investment program to achieve the wealth creation within the given risk appetite. For media queries, please contact: Rasheed Palliyalil Watermelon Communications Dubai, UAE rasheed@
