IHH pegs Value of Medanta at Rs 5500-5700 crore

New Delhi: In order to buy controlling stake in Medanta –The Medicity super specialty hospital, IHH Healthcare Behard has placed its bid, according to a recent report in Mint.Citing two people, the report stated that the bid values the company at Rs 5,500-5,700 crore.

Presently, private equity major Carlyle holds 27 percent stake and Temasek holds 18 percent stake in Medanta hospital together constituting 45 percent stake, whereas the remaining 55 percent is with Trehan’s family and other promoters, including co-founder Sunil Sachdeva.

According to the report, IHH which is looking to expand its investments in the healthcare sector in the country has now made a bid towards a stake in Medanta. Medical Dialogues team had earlier reported that IHH is also looking to acquire Fortis Hospitals to expand its presence in India and is set to launch a voluntary open offer to buy the non-promoter shares of Fortis Healthcare in the next few days.

According to recent media reports Temasek Holdings is also looking to expand its stake in Medanta to a controlling stake and may submit a bid in the next few weeks,

IHH Healthcare, one of the largest healthcare group which operates more than 50 hospitals in 10 markets under brands like Gleneagles, Mount Elizabeth, and Parkway and already has a strong presence in India. In 2015, it acquired 51 percent stake in Continental Hospitals Ltd for Rs 300 crore and 74 percent stake in Global Hospitals Pvt. Ltd for Rs 1,280 crore.

One of the two people cited told Mint, “Trehan was initially looking at a valuation of $1-1.2 billion (Rs6, 500-7,500 crore) for Medanta a year ago, but a fall in revenue has hit the valuation. The company’s revenue figures could not be independently ascertained. Medanta has also suspended its $250-300 million initial public offering plan”.

He further added that the hospital has seen a drop in its revenue after several leading doctors left in the last couple of years, said the second person.

Top doctors who left Medanta and joined Fortis include Dr. Rajesh Ahlawat, who was chairman of Institute of Kidney and Urology; Dr. Vijay Kher, who was chairman, nephrology and renal transplant medicine; and Padma Shri winner Dr. Ashok Rajgopal, a leading knee and hip replacement surgeon who was chairman of Medanta’s Bone and Joint Institute. Dr. Gagan Gautam, who was head of urologic cancer surgery and robotic surgery, moved to Max Hospital in Saket reports Mint.