TPG buys $146m stake in India’s Manipal Hospitals
TPG Capital has paid INR9 billion ($146 million) for a significant minority stake in healthcare services provider Manipal Health Enterprises (MHE).
The terms of the transaction were not officially disclosed but the GP is understood to have picked a 25% stake, valuing the business at around INR36 billion.
Originally set up in 1942, MHE - which operates as Manipal Hospitals - is part of Manipal Education and Medical Group and offers healthcare services across India. Currently, the company owns and operates ten multi-specialty hospitals in the Indian states of Maharashtra, Karnataka, Andhra Pradesh, Tamil Nadu and Goa.
The business also manages five teaching hospitals in Karnataka and Sikkim, and several fertility clinics across the country. In addition, Manipal Hospitals indirectly owns and operates a hospital in Malaysia and manages a clinic in Nigeria.
“This is a significant foreign investment into the Indian healthcare industry, which is worth over US$80 billion,” said Dr. Ranjan Pai, CEO and MD of the Manipal Group, in a statement. “This investment allows MHE to access TPG’s operational know-how and international experience while strengthening our financial position, which allows us to uphold an unwavering focus on better patient outcomes.”
According to AVCJ Research data, MHE has raised a number private equity rounds. In 2012, India Value Advisors (IVFA) pledged to invest INR10 billion to MHE over a three-year period. Prior to that the business had received INR3 billion from Kotak Private Equity and other investors since 2005.
The company - which has around 5,500 beds under management - will use this latest round of funding to further expand its presence in India and overseas.
MHE and TPG were jointly advised by Allegro Capital Advisors; TPG also received financial advice from Kotak Mahindra Capital Company; and legal advice from AZB & Partners and Cleary Gottlieb Steen & Hamilton.
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