Transaction:
- Manipal Hospitals has entered into a definitive agreement to acquire a controlling stake in Sahyadri Hospitals from Canada’s Ontario Teachers’ Pension Plan Board (OTPP).
- The transaction is valued at Rs. 6000 crore, and is subject to regulatory approvals.
- OTPP is exiting its investment in Sahyadri Hospitals with approximately 2.6x times return on its original investment.
About Sahyadri Hospitals:
- Incorporated in 1996 and based in Pune, Sahyadri operates a network of 11 hospitals across key cities in Maharashtra.
- Offers a comprehensive range of specialties including cardiology, neurology, organ transplants, orthopaedics, gastroenterology, critical care, and maternal & child health
About Manipal Hospitals:
- Founded in 1991 and headquartered in Bengaluru, Manipal Hospitals is India’s second-largest healthcare provider, with a network of 38 hospitals, 10,500+ beds, across 19 cities.
- The group is backed by leading global investors, including Temasek Holdings (Singapore) and TPG Capital.
Rationale:
- This acquisition will strengthen Manipal’s presence in western India and make it a hospital chain of 49 hospitals with 12,000 beds across the country.
- Sahyadri operates through a diversified asset structure – three owned hospitals, three under long-term leases, two on short-term leases, and one flagship facility managed under an operation and maintenance (O&M) arrangement.
- The group’s hub-and-spoke model, with Pune as the hub for quaternary care and other locations as spokes for secondary and tertiary services, provides a scalable framework for Manipal to expand service reach.
- Sahyadri Hospitals adds significant operational strength, having reported Rs. 814 Crore in revenue and Rs. 86 Crore in net profit for FY24.
- The partnership will bring together two well-established healthcare platforms, enabling collaboration in clinical quality, operational excellence, and access to broader patient populations.
- Ontario Teachers’ Pension Plan (OTPP), which acquired a majority stake in Sahyadri in 2022 and invested approximately Rs. 275 Crore, has supported the platform’s expansion and quality improvement efforts.
- Earlier in 2024, Sahyadri strengthened its regional presence by acquiring a controlling stake in Saideep Healthcare in Ahmednagar, highlighting its growth-focused approach.
- The transaction is consistent with Manipal’s strategy of expanding through selective acquisitions, building on its integration of Columbia Asia and AMRI Hospitals in recent years.
Acknowledgements:
RBI Bulletin (www.bulletin.rbi.org.in), SEBI (www.sebi.gov.in), NSE (www.nseindia.com), BSE (www.bseindia.com)
Disclaimer:
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