Olympus invests $100m in DM Healthcare, India Value Fund exits
Olympus Capital Asia Investments has invested more than INR5 billion ($100 million) for a minority stake in DM Healthcare, in a deal which enabled existing investor India Value Fund to exit the company.
The transaction took place via a capital increase and the provision of replacement capital to India Value Fund, which was previously expected to re-invest in the firm that it backed with $45 million five years ago.
Dubai-based DM Healthcare is a major healthcare services provider with a rapidly expanding presence in India. It has the largest network of medical centers, hospitals and pharmacies in the Gulf Cooperation Council countries, and owns five hospitals, 38 medical centers and 75 pharmacies under the Aster umbrella, largely located in southern India.
Following this capital injection, Olympus, which invested via its international investment company OCAI, will become the company's largest external shareholder and appoint representatives to DM's board. The new funding will be used to expand DM's domestic operations, which include establishing a national healthcare network in Mumbai. Among the company's other projects under development is the promotion of Kochi as a destination for medical tourism.
Olympus Managing Director Gaurav Malik: "A combination of increased consumer spending and high prevalence of chronic diseases is expected to lead to significant growth in the healthcare industry in the rapidly growing markets of India and the GCC countries."
Daniel Mintz, Olympus founding managing director, added: "DM Healthcare has built a successful track record of running world-class healthcare facilities across multiple countries and has a robust strategy to increase healthcare penetration in Tier 2 and Tier 3 cities in India."
Azad Moopen, chairman and managing director of DM, continues to hold a majority stake in the company. He said he remains optimistic about the business prospects of the healthcare sector in these countries.
Veda Corporate Advisors advised DM on this transaction.
The DM deal is the latest in a series of investments involving Indian healthcare firms. In December, Bessemer Venture Partners funneled INR2 billion into Nephroplus, a Hyderabad-based chain of kidney care and dialysis clinics. Last March, meanwhile, Malaysian sovereign wealth fund Khazanah Nasional invested $104 million in India's Apollo Hospitals, taking an 8.82 % stake from Bisikan Bayu Investments, another Malaysian government fund.
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