Mumbai: Private equity firm True North is looking to sell its over decade-old stake in Bengaluru-based maternal and child healthcare chain Cloudnine Hospitals as the company prepares to raise $250-300 million in a fresh funding round, according to two people familiar with the matter.
“The round will be a mix of primary and secondary, where some early investors will sell their stake,” one of the people said on condition of anonymity. “A significant part of the proceeds (about $150 million) will be used towards inorganic plans in the Middle East where it is closely evaluating some opportunities.”
“The company is expected to seek a higher valuation post the recent acquisition,” a second person cited above said, adding that Allegro Capital is advising on the transaction.
The fundraising exercise comes weeks after Kids Clinic India Pvt. Ltd, which operates Cloudnine Hospitals, agreed to acquire the maternity, childcare and fertility businesses of Apollo Health & Lifestyle in a cash-and-stock transaction valued at about $160 million.
Higher valuation
While the bulk of the company's stake is held by private equity funds—True North (first invested in 2015), Temasek (2024) and TPG NewQuest (2021), Apollo holds a 9.9% stake worth ₹785 crore in Cloudnine post its recent transaction in May, valuing the overall asset at about ₹7,930 crore (or about $825 million). The promoters hold a small shareholding in the company.
Allegro, True North and Cloudnine did not respond to Mint’s requests for a comment till the time of publishing.
Founded in 2006 by R Kishore Kumar, Rohit M.A., M. Ramachandra and Vidya Kumar, Cloudnine is a chain of super-speciality hospitals catering to mother and baby care, including fertility, maternity care, gynaecology, paediatrics, neonatology, baby care and stem cell banking.
The Bengaluru-headquartered company has about 40 centres across northern and southern India, spanning 13 cities, including Bengaluru, Delhi, Mumbai, Pune, Chennai, Gurgaon, Ludhiana and Chandigarh.
It also plans to set up units across various metros and tier I cities, and improving geographical diversification is expected to reduce the company’s operational dependence in one specific area, credit rating agency Icra said.
In FY25, the company reported operating revenue of ₹1,485.6 crore compared with ₹1,187.7 crore. Its losses widened to ₹46.4 crore from ₹27.9 crore in FY24, according to Icra’s report from last year. The company is expected to see healthy revenue growth over the near term, driven by a steady ramp-up at the existing centres and improving revenue share from the new centres, it added.
Cloudnine competes with players such as Motherhood Hospitals, Indira IVF, Milann Fertility & Maternity, Rainbow Children’s Hospital and other large general hospital chains like Manipal Health Enterprises and Max Healthcare, that operate expansive mother-and-child wings.
Broadly, India’s healthcare provider market is expected to grow by over 10% into a $95 billion market by 2030. Of this, single specialty segment is projected to grow from $4.4 billion in 2025 to around $12.3 billion in the same period, Bessemer Venture Partners highlighted in a report earlier this year.
India is seeing an industry-wide shift toward single speciality, reflecting a structural re-orientation of healthcare delivery. The traditional multi-speciality, jack-of-all-trades hospital model is giving way to focused, standardised, and patient-centric systems, the company noted.
This new class of specialty-native providers is built on more agile chains to deliver superior clinical outcomes, better patient experiences, and inherently more scalable economics and the growth of this segment is driven by an aging population, rising insurance penetration, spend and health awareness, and sustained investor interest.