Elara Capital to launch India-focused healthcare fund
Elara Capital, a UK-based financial services company, is in talks with a counterpart in Dubai with a view to launching a private equity fund that will target healthcare investments in Asia and Africa. India will be a particular area of focus given Elara’s strong presence in the country.
The fund could be worth $250-300 million, The Business Standard reported. Raj Bhatt, vice chairman and CEO of Elara, said that fundraising could start by March or April. He noted that there is tremendous potential growth in the healthcare space in India with capital expenditure still low.
Elara already manages vehicles including Elara India Gateway Fund and Elara India Opportunities Fund, which are domiciled in Luxembourg and Mauritius, respectively. The company plans to launch an India-focused sector agnostic private equity fund, also in the $250-300 million range, once the healthcare vehicle is up and running.
A number of specialist funds have been created targeting India's healthcare sector - which is thought to be worth $65 billion - including most recently the Somerset Indus Healthcare Fund I. Investment into the sector by sector agnostic operators, meanwhile, continues apace, involving assets ranging from hospital chains to medical device manufacturers.
In January, Olympus Capital Asia Investments paid more than INR5 billion ($100 million) for a minority stake in health services provider DM Healthcare, in a deal which enabled existing investor India Value Fund to exit the company. One month earlier, Bessemer Venture Partners funneled INR2 billion into Nephroplus, a Hyderabad-based chain of kidney care and dialysis clinics.
There has also been considerable activity surrounding Max Healthcare, which sold a 26% stake to South Africa's Life Healthcare for INR5.16 billion in October, in what is one of the largest foreign investments in India's healthcare sector. Earlier in the year, Warburg Pincus sold its 16.37% interest in the business to parent company Max India for INR1.4 billion. Goldman Sachs subsequently invested about $59 million in Max India, taking its stake in the company to nearly 16%.
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