Mumbai: Buyout firm TPG Capital and Manipal Hospitals are set to announce the purchase of Dr Naresh Trehan’s Medanta chain of hospitals as soon as next week, in one of the largest acquisitions in the Indian healthcare industry, two people aware of the development said.
The transaction ascribes an enterprise value of ₹5,800-6,000 crore to the hospital chain, one of the two people cited above said on condition of anonymity.
“The two parties are expected to sign definitive agreements soon," said the person.
Medanta counts private equity firms Carlyle and Temasek as its investors. While Carlyle Group acquired a 27% stake in Medanta’s parent, Global Health, in 2013, Temasek bought an 18% stake in 2015 from Punj Lloyd Ltd. Trehan, his family and Medanta co-founder Sunil Sachdeva own the rest.
Medanta’s existing investor Carlyle is likely to exit the company through the proposed transaction, the person added.
Mint reported in February that Manipal was engaged in a three-month exclusivity period with Medanta to conduct due diligence and negotiations. Medanta operates hospitals and clinics across Gurugram, Lucknow, Indore, Ranchi, Kolkata and Sri Ganganagar.
The combination of TPG Capital and Manipal Group started exploratory talks with the owners of Medanta in October to buy a majority stake in the hospital chain after Malaysia’s IHH Healthcare Bhd withdrew its non-binding offer. IHH acquired the hospital business of crisis-ridden Fortis Healthcare Ltd in July, outbidding the TPG-Manipal combine. In March 2018, IHH had valued Trehan’s hospital chain at around ₹5,700 crore, Mint reported.
“We do not comment on market speculation," a Medanta spokesperson said in an emailed response to queries. Text messages sent to Ranjan Pai, promoter of Manipal Education and Medical Group, did not elicit a response.
Spokespersons for TPG and Carlyle declined to comment. “Temasek does not comment on market speculation and rumours," said a spokesperson for the company.
TPG invested $146 million in Manipal Hospitals in 2015 for a significant minority stake. Temasek also owns a minority stake in the hospital chain.
TPG-owned healthcare platform Asia Healthcare Holdings has invested in several healthcare companies, including India’s second-largest network of in vitro fertilization centres, Nova Fertility.