Manipal eyes Medanta, Sets Valuation at Rs 6000 crore: Report

Mumbai: After facing a setback with the lost Fortis bid, the healthcare giant, TPG Capital and Manipal Health Enterprises combine, is leaving no stone unturned to augment its healthcare business.

According to a recent report in MINT, TPG-Manipal is vying to buy a majority stake in the Gurugram-based super-speciality hospital Medanta-The Medicity. However, no formal bid has been made yet to this effect.

To acquire its majority share, the healthcare giant has likely valued Medanta at Rs 6,000 crore and is currently in talks with the Medanta hospital-owner and heart surgeon Dr Naresh Trehan and other investors.

Two persons familiar with the development informed Mint, “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.”

“TPG has been actively looking to build up Asia Healthcare Holdings—its healthcare platform. Medanta’s acquisition will help the private equity firm diversify its healthcare investments,” the source added, requesting anonymity.

US-based private equity fund Carlyle Group owns 27% in Medanta, while Singapore’s Temasek Holdings Pte holds a share of 18%. Dr Trehan, his family and Medanta co-founder Sunil Sachdeva own the rest of the hospital.

Medanta-The Medicity was founded in the year 2009. Under it, hospitals and clinics across cities including Gurugram, Lucknow, Indore, Ranchi and Sri Ganganagar are currently being operated.

The sources pointed out to the Mint that Medanta has been under pressure because of price controls imposed by National Pharmaceutical Pricing Authority (NPPA).

In August last year, the drug pricing regulator capped the prices of knee implants, reducing product prices by as much as 70% and had brought cardiac stents under price control in February to make them affordable. The price of drug-eluting stents drastically went down to about Rs 30,000 from over Rs 2 lakh, which evidently hit the revenues of all the hospitals in the country.

Similarly, Medanta also saw a cry off in its revenue after several of its top doctors quit to join rivals such as Fortis and Max Healthcare Ltd.

“Carlyle also plans to sell its investment through the transaction,” the sources revealed while talking to the Mint.

This US-based TPG Capital has sharpened its focus on healthcare investments in India since 2016.

Two months ago, the TPG-Manipal was seen vying for AMRI Hospitals Ltd (Advanced Medical Research Institute) in Kolkata. Manipal Hospitals had revived talks with FMCG major Emami Group to acquire its AMRI Hospitals Ltd. Emami looking for a valuation of Rs 800-1,000 crore for the hospital chain.

Read Also: After losing Fortis Bid, Manipal vyes to buy AMRI for upto Rs 1,000 crore