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WASHINGTON, D.C., March 19, 1999 —
The International Finance Corporation is making its first investment in Brazil's healthcare industry in a project that will enable healthcare providers and financiers – such as hospitals and insurance companies – to offer better quality and more efficient services to patients throughout the country.
IFC's US$6.25 million quasi-equity investment in Innovative Health Services (IHS) will establish it as a holding company with an initial capital base of $25 million to invest in a number of young and growing companies providing services to the industry.
The demand for quality private healthcare services in Brazil has increased dramatically with many Brazilians using private insurance, a general dissatisfaction with the public healthcare system, and easier access to information. At the same time, major technological advances in medical equipment and drug treatments as well as an aging population have driven up healthcare costs in the country. In order to respond to the increasing demand and rising costs, the industry is seeking more efficient operations that can provide higher quality care at lower costs. IHS will help the industry by investing in companies involved in areas such as home care, occupational and preventive medicine, information technology, prescription benefit management and hospital services and management.
The project will lower costs and improve the quality of health services in Brazil while offering the best healthcare innovations available, said Karl Voltaire, IFC Director for Latin America and the Caribbean. He added that the project would create new options in healthcare, which may change the way such services are delivered in Brazil.
The main sponsors of the project are the Icatu Group, a leading Brazilian financial firm and the Jose de Melo Group, one of Portugal's leading conglomerates. Both of these sponsors have significant investment experience and as well as expertise at actively managing health service operations.
IFC, part of the World Bank Group, fosters economic growth in the developing world by financing private sector investments, mobilizing capital in the international financial markets and providing technical assistance and advice to governments and businesses.
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