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Sept. 9, 2022 9:15 AM PDT

ByteDance, the Chinese parent company of TikTok, made way for a new addition to the family last month, when it reportedly paid $1.5 billion to take control of one of the largest private hospital companies in China. Founded in 2006, Amcare Healthcare operates a chain of lavish birthing centers and women’s and children’s hospitals in major cities like Beijing and Shenzhen. Its VIP postpartum package costs roughly $32,000 for 28 days of care.

The purchase raised eyebrows on the other side of the Pacific, where some observers wondered why a company best known for hooking teens on viral dance videos would get involved in the highly regulated healthcare industry. ByteDance has previously invested in some firms outside the tech sector, including a coffee shop chain, but Amcare is almost certainly its biggest acquisition. The move came after ByteDance recently dissolved its strategic investment team.

So what gives? ByteDance did not respond to requests for comment. But longtime observers of the company, like Siren Chen, a Shanghai-based senior healthcare analyst at market research firm EqualOcean, speculate that ByteDance could leverage its massive video and news apps to build trust with patients and convince them to choose Amcare’s services.

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