(Bloomberg) -- After decades of operating Hong Kong’s marquee airline and coke bottling factories in China, Swire Pacific Ltd. is diversifying into a new line of business: private hospitals in China and Southeast Asia. 

It has agreed in principal to acquire a controlling stake in DeltaHealth China Ltd., a hospital in Shanghai specializing in heart and vascular care. The purchase will mark the first health-care project where Swire leads the operation, as the Hong Kong-based conglomerate seeks to boost growth. 

It follows Swire’s minority investment in the facility in 2021 and aligns with the group’s strategy of being a long-term owner and operator of health-care services, Chairman Guy Bradley said in a statement Thursday. 

“We will seek investment opportunities in the Chinese mainland and Southeast Asia which have demonstrated profitability and have the potential for future growth,” he said. “The challenges and uncertainty in the current economic environment may result in more opportunities coming to market in the medium term.”

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The group on Thursday reported record underlying profit of HK$36.2 billion ($4.6 billion) for 2023, mainly due to the robust recovery of its aviation arm Cathay Pacific Airways Ltd. It also sold several major assets, and posted an HK$22.9 billion gain from the sale of its US beverages business to its controlling shareholder. 

The 208-year-old Swire, one of the two remaining British trading houses in Hong Kong, has doubled down on its China investment. While aviation, property and beverages have been key sources of revenue, it’s now also looking to diversify into Southeast Asia and other emerging economic sectors amid China’s slowing growth and ongoing real estate crisis. 

Swire and the Indonesia Investment Authority inked a partnership in December to jointly invest in Pertamina Bina Medika-Indonesia Healthcare Corporation (IHC), which operates 37 hospitals and 66 clinics across the country. It marked the group’s first health care investment in Southeast Asia. The transaction is subject to antitrust approval and is expected to close in the second quarter.

In China, the conglomerate has already made a minority investment in several medical businesses, including private hospital and elderly housing operator Columbia China Healthcare and SHH Core Holding Ltd., which owns a family hospital in Shenzhen and clinics in Hong Kong. 

Swire has invested HK$2.7 billion in the health care sector as of the end of 2023. Two years ago, its investment arm said it would spend HK$20 billion over the next decade in mainland China’s health-care sector. The business unit narrowed its loss slightly to HK$165 million last year.  

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