TikTok’s Parent Company Bought a Bunch of Hospitals for $1.5B
TikTok's Chinese owner, ByteDance Ltd., has acquired one of China's largest private hospital chains-Amcare Healthcare-for roughly $1.5 billion, Bloomberg reported. This deal marks one of the biggest purchases made since Beijing's anti-monopoly crackdown on tech companies started in late 2020.
ByteDance Ltd. now has full ownership of women's and children's hospitals in cities from Beijing to Shenzhen, Bloomberg reported, citing a source with knowledge of the matter. The outlet also found corporate registries that show two ByteDance subsidiaries now own 100 percent of Amcare. This is the company's first foray into the healthcare industry, but not its first time branching into other sectors, having already made investments in everything from cleaning robots to coffee to hotpot chains.
With the acquisition of Amcare, it seems that ByteDance is trying to disrupt the traditional healthcare industry in order to compete with other large tech giants. This acquisition follows a pattern of tech companies making similar investments in healthcare, such as Amazon and Apple. In late July, Amazon announced that it agreed to a deal to acquire One Medical, a tech-focused primary care provider, for $3.9 billion. In a statement, Amazon said that the healthcare field was ripe for disruption. Meanwhile, around the same time, Apple published a nearly 60-page report outlining its health features and partnerships with medical institutions to argue that these offerings are the key to its future.
ByteDance's step into healthcare began in 2020 when it acquired a medical knowledge platform called Baikemy.com and established its own healthcare app later that year known as Xiaohe Health. Now, it adds Amcare's seven hospitals, two integrated clinics, and five postpartum centers across China to its portfolio.
This decision comes a few weeks after it was announced that ByteDance's valuation dropped 25 percent since last year, showing the impact of tighter regulation on one of China's top tech giants. As a response to the Chinese government's effort to regulate the internet, including a guideline that requires the country's internet companies to obtain its approval before undertaking any investments or raising funds, ByteDance had to downsize its investment department in January.