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ByteDance’s diversification foray is also pushing it into the metaverse as it is competing with Meta Platforms for the manufacture of VR headsets through the acquisition of Pico.
ByteDance, the world’s most valuable startup and the parent company of the social media app, TikTok has made its first foray into the world of healthcare with the acquisition of Amcare Healthcare.
As reported by Bloomberg, citing a first-hand report from financial media outlet Caixin, ByteDance paid the sum of 10 billion Chinese Yuan (approximately $1.5 billion) for Amcare in what is regarded as one of homeland China’s biggest deals since the government started cracking down on tech startups in the country.
Amcare Healthcare operates women’s and children’s hospitals and it has as many as 7 hospitals nationwide. Since its establishment in 2006, Amcare Healthcare has extended its operational base to also include two integrated clinics and five postpartum centers across China, according to the company’s website.
Amcare Healthcare has been deepening its foothold as a major player in the Chinese healthcare industry over the years. The startup received the license from regulators to conduct in-vitro fertilization back in 2020, following its acquisition of a hospital in Beijing. The milestone has positioned the healthcare chain as one of the most revered for the procedure in the past few years.
ByteDance and the Need to Diversify into Healthcare
Divesting its capital base has been tagged as one of the crucial strategies to extend its influence and compete with other tech giants in the country. The acquisition of Amcare will further contribute to its foray into medicine, its telemedicine application Xiaohe which provides online medical consultations, organizes hospital appointments, and provides general wellness services. Xiaohe competes with the likes of Alibaba Health Information Technology Ltd. and Ping An Healthcare and Technology Co
Following records from corporate registry tracker Qichacha, two of ByteDance’s subsidiaries controls a combined 100% stake in the newly acquired Amcare Healthcare. While no Amcare executive or spokesperson has confirmed the acquisition yet, a spokesperson for ByteDance’s Xiaohe has confirmed the acquisition, however, the exact size of the deal was not disclosed.
It is also unclear how the previous investors of Amcare Healthcare which includes Hillhouse Capital, China Renaissance, and Warburg Pincus amongst others per data from Qichacha will act in this situation. With ByteDance is known for transforming the startups under its brand, there is an expectation that the Amcare Healthcare business will be further integrated into the Xiaohe business model, a move that will give it a more competitive edge as it vies for a spot in the healthcare industry that is worth $86 billion.