MUMBAI: Private equity firm Everstone Group has signed an agreement to acquire a controlling stake in Sahyadri Hospitals Ltd, the largest hospital chain in Maharashtra, the PE firm said in a statement on Sunday.

Founded in 1994, Pune-based Sahyadri Hospitals currently operates five tertiary care and three secondary care hospitals with 750 beds across Pune (Deccan Gymkhana, Nagar Road, Kothrud, Bibwewadi, Kasba Peth and Hadapsar), Nashik and Karad. Sahyadri has more than 1,000 clinicians and 2,300 supporting staff, providing medical services.

A combination of primary and secondary capital outlay is expected to increase the bed count significantly in the next five years, Everstone said. The investment will help Sahyadri to cement its position as the leading healthcare chain in Maharashtra, it added. Financial details of the transaction were, however, not disclosed.

“Sahyadri Hospitals is a reputed name for quality healthcare and will act as the anchor asset of our healthcare delivery platform. Everstone will leverage its significant healthcare expertise and experience to grow the overall business," said Sameer Sain, CEO, Everstone Group.

Revenue of private secondary and tertiary healthcare delivery in India is expected to grow from $42 billion in 2018 to $65 billion in 2022, at a compounded annual growth rate (CAGR) of approximately 12%, the statement said.

“We are excited about this partnership and the value Everstone Group brings. Sahyadri Hospitals looks forward to the next phase of growth with the support of the experienced team at Everstone," said Dr Charudutt Apte, founder, chairman and managing director, Sahyadri Hospitals.

Everstone, which manages $4 billion in assets, is one of the largest India-and South East Asia-focused healthcare investor, specializing in rolling up assets on their platforms. In 2015, Everstone had successfully exited Global Hospitals, a large multi-speciality tertiary hospital chain, generating strong returns.

Everstone’s healthcare portfolio includes controlling stakes in domestic pharma distribution platform Ascent Health; South East Asia-based diagnostic device platform Everlife and nutraceutical ingredient business OmniActive.

It had recently announced its successful exit from contract research and manufacturing firm Rubicon Research, generating returns of 4.5 times. The hospitals business in India has been witnessing a wave of consolidation. In February, Mint had reported that US’s TPG Capital and India’s Manipal Group had jointly entered into exclusive negotiations with heart surgeon Dr Naresh Trehan and other investors to buy a controlling stake in hospital operator Medanta.

Last December, Radiant Life Care Pvt. Ltd, backed by private equity firm KKR and Co., agreed to buy a controlling stake in Max Healthcare Institute Ltd.

Last year, Malaysian hospitals operator IHH Healthcare Bhd had acquired a controlling stake in India’s second largest hospital chain Fortis Healthcare for 4,000 crore.

In June 2018, General Atlantic had invested $130 million in Hyderabad-based Krishna Institute of Medical Sciences to acquire a significant minority stake. In 2017, homegrown PE firm True North had invested $200 million in Kerala Institute of Medical Sciences.

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