PE: Temasek buys 59% controlling stake in Manipal Health Enterprises

Transaction:

  • Sheares Healthcare, a unit of Singapore’s Temasek, has agreed to buy a controlling stake in Manipal Health Enterprises, raising its ownership from 18% to close to 59% for about Rs. 16,400 Crores.
  • The National Investment and Infrastructure Fund (NIIF) will sell its entire 8% stake, they said, while Sheares Healthcare will acquire the remaining stake from the holding entity backed by Ranjan Pai.

 

About Manipal Health Enterprises:

  • Established in 1991, the first branch of Manipal Hospitals was started in Bangalore. The branch is a 600-bed quaternary care facility and houses over 60 specialties.
  • Manipal currently has 8,300 beds in 29 hospitals spread in 16 cities, making them the second largest hospital chain in India.

About Temasek:

  • Founded in 1974, Temasek is a global investment company headquartered in Singapore, has portfolio value as at 31st March 2022 of 403 billion USD.
  • Temasek’s recent investments include HealthKart for over Rs 1,100 Crores, Molbio Diagnostics for over Rs 690 Crore, DeHaat for Rs 486 Crores, Country Delight for Rs 185 Crore, Eye care chain Dr Agarwal’s for Rs 1,050 Crores.

 

Rationale:

  • The additional 41% stake is brought by Temasek at Rs 16,400 Crores, valuing the hospital at Rs 40,000 Crores, this is the largest health sector deal in India.

Stakeholders

Previous stake

New stake

Temasek

18%

59%

Pai Family

52%

30%

TPG Capital and other stakeholders

21%

11%

  • Manipal has been expanding across India, In March 2023, Manipal acquired the Kolkata-based AMRI Hospitals, in a deal worth Rs. 2400 Crores (subject to approval from the West Bengal government), In June 2021, Vikram Hospital for around Rs 350 Crores, and In 2020, it acquired Colombia Asia for Rs 2,100 Crores.
  • Chairman of Manipal Hospital Dr. Pai commented that the valuation of the hospital is reflective of long term potential of the healthcare service segment of India.
  • Pai further commented that consolidation will continue in healthcare space and lot more PE Funds will continue to invest large checks in this area.

Acknowledgements: 

RBI Bulletin (www.bulletin.rbi.org.in), SEBI (www.sebi.gov.in), NSE (www.nseindia.com), BSE (www.bseindia.com)

Disclaimer:

This material has been prepared by the personnel in Vora Corporate Finance which is Investment Banking arm of Vora Management Consultancy Private Limited and looks after Mergers & Acquisitions (M&A), Private Equity (PE), Fund Raising, Debt syndication and Valuations and is based out of Ahmedabad, Gujarat, India. Any views or opinions expressed herein are solely that of individual authors and may differ from view of Vora Management Consultancy Private Limited. This material is proprietary to Vora Management Consultancy Private Limited and is for your personal use only. Any distribution, copy, reprints or forward to others is strictly prohibited.

This material captures the information based on information available in the public domain, public announcements and sources believed to be reliable. Analysis contained herein is based on publicly available information and appropriate assumptions. This material is intended merely to highlight market developments and is not intended to be comprehensive and does not constitute strategic, investment, legal or tax advice. In no event Vora Management Consultancy Private Limited be liable for any use by any party or for any decision made or action taken by any party in reliance upon, or for any inaccuracies or errors in, or omissions from, the information contained herein and such information may not be relied upon by you for evaluating any transaction. 

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