TPG Capital and Manipal Health Enterprises are in talks to jointly acquire majority stake in hospital operator Medanta from heart surgeon Naresh Trehan and other investors, Mint reported.
Trehan, his family, and Medanta co-founder Sunil Sachdeva own around 55 percent stake in the Gurugram-based hospital. US-based private equity fund Carlyle Group owns 27 percent in Global Health, which owns, manages and operates Medanta, while Singapore’s Temasek Holdings holds 18 percent stake.
“While the discussions are still on and it is yet to submit a bid, Manipal-TPG is likely to offer a valuation of Rs 6,000 crore for Medanta,” a source told the paper.
Moneycontrol could not independently verify the report.
Earlier, Malaysia’s IHH Healthcare had submitted a bid for Medanta, valuing the firm at around Rs 5,700 crore. IIH, however, withdrew its non-binding bid following its acquisition of the hospital business of crisis-ridden Fortis Healthcare in July, outbidding TPG-Manipal.
Medanta’s acquisition would help TPG Capital further expand its healthcare systems in India as the US-based company has been sharpening its focus on healthcare investments in India since 2016, the report said.
“TPG has been actively looking to build Asia Healthcare Holdings — its healthcare platform. Medanta’s acquisition will help the private equity firm diversify its healthcare investments,” another source told the paper.
As of now, TPG Capital’s healthcare portfolio in the country includes Cancer Treatment Services International; Bengaluru-based Rhea Healthcare, the operator of hospitals for women and children under Motherhood brand; and Sai Life Sciences, a drug discovery and manufacturing firm.
Medanta has been under pressure because of price controls imposed by the National Pharmaceutical Pricing Authority (NPPA), the drug pricing regulator. The latter capped the prices of ortho knee implants, citing public interest, in August last year. Earlier this year, NPPA further cut the ceiling prices of the most commonly used drug-eluting stent (DES) by 5.8 percent.
These controls brought down DES prices to about Rs 30,000 from around Rs 2 lakh, hurting revenues of hospitals in India.
According to the report, Medanta also reported a decline in its revenue after several of its top doctors quit to join rivals such as Fortis and Max Healthcare.
Medanta operates hospitals and clinics across cities including Gurugram, Lucknow, Indore, Ranchi, and Sri Ganganagar.