Q1 2026 - (released May 2026)
SA's quarterly Private Equity & Venture Capital magazine
How mezzanine funding is helping to scale South Africa’s
medical rehabilitation sector
by Lungi Gwente
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South Africa’s healthcare system continues to face mounting pressure, with public hospitals stretched, and demand for post-acute and rehabilitation services steadily increasing. As the gap between capacity and need widens, private capital is playing a growing role in scaling essential healthcare infrastructure.
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Alternative funding structures, including mezzanine debt, are increasingly used to support mid-market healthcare operators that require flexible growth capital without diluting ownership. In an environment where traditional bank funding may not fully support expansion pipelines, structured capital solutions are proving critical.
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Against this backdrop, Tamela Mezzanine Debt Fund I’s investment in Nurture Health demonstrates how well-structured mezzanine funding can accelerate national healthcare expansion while delivering measurable financial and social returns.
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In June 2021, Tamela supplied a mezzanine loan facility in support of Nurture Health’s expansion ambition: to become one of South Africa’s largest acute and sub-acute rehabilitation networks.
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The group has since grown from 15 to 27 facilities across five provinces, increasing bed capacity to 312,440. This was the result of new facilities built in Alberton, Beacon Bay, Worcester and Montana; six facilities acquired as the result of a merger with a group that has presence in the Western Cape; and two facilities acquired through a 100% acquisition of a group based in Gauteng. A new 54-bed acute physical rehabilitation hospital will open in Mossel Bay in April 2026.
Nurture Health provides sub-acute, post-acute and transitional physical rehabilitation medical care for individuals recovering from injury and disease, as well as patients facing psychiatric and substance abuse challenges – services that are increasingly critical within the broader healthcare ecosystem.
The business was identified by Tamela as a high-quality, defensive growth opportunity in a resilient healthcare sector.
At the time of investment, Nurture Health had an established presence in South Africa’s physical rehabilitation market, with a clear development pipeline. The Tamela team saw growing demand for post-acute and sub-acute care, supported by a scalable platform capable of expanding access while maintaining strong clinical and governance standards.
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The funding was structured as growth capital to accelerate new facility rollouts and upgrades, alongside senior debt and internally generated cash flows. Beyond capital, Tamela acted as an observer on the company’s Investment Committee, providing strategic oversight during the expansion phase, and ensuring disciplined capital allocation.
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During the investment period, Nurture treated 10,856 patients and maintained a 4.6 out of 5 satisfaction rating from referring doctors and hospitals. Women represented 59% of patients, and the group worked with insurers and state injury funds to reduce financial barriers to access.
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Employment impact was also significant, with the workforce growing to 761 employees, including 502 new hires since June 2021. Black women represent 45.2% of the workforce, while women hold 21.05% of leadership roles.
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Tamela’s role was seen as key to the growth and development of the Nurture Care Group, firstly through the confidence it displayed by providing the significant funding required to implement the business’s plans.
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Secondly, the experience and skill of the Tamela team helped grow the business’s own governance capability and invigorated its journey, transforming from an owner-managed business to a responsible and professional corporate citizen.
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Nurture refinanced and repaid Tamela two years ahead of time, delivering returns above the Fund’s 18% target.
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Tamela’s funding of Nurture Health is a clear example of how well-structured mezzanine capital can catalyse growth in essential service sectors while delivering measurable social impact.
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Gwente is an Associate | Tamela