Private equity group Abraaj and a consortium of PD Hinduja Hospital and Everstone Capital Advisors are among those markets to emerge as the front-runners to acquire Hyderabad-headquartered multi-speciality hospital chain CARE Hospitals from its current private equity owners Advent International.
They are competing with rival offers from another combination of South African healthcare chain Netcare and Bain Capital, Singapore's Temasek Holdings and Baring Private Equity Asia.
AdvertisementThe shortlisted candidates have been handpicked from a keenly contested process that had earlier seen interests from China's Fosun Group, Malaysia's IHH Healthcare Bhd, private equity heavyweights Carlyle and domestic rivals like Manipal Hospitals.
Such strategic and financial sponsor interests for private hospital chains underscore the potential of a market that is witnessing compound annual growth rate of around 13% as affluent Indians get willing to pay a premium for better equipped facilities. Most of the offers have valued the chain at Rs 1500 crore - Rs 1800 crore inclusive of its debt, added the sources mentioned above.
"It is a fully juiced out asset and doesn't throw out cash like a Medanta or Apollo. It is also largely based in Tier II cities and have smaller operations while its flagship property is in Hyderabad, a fiercely competitive market," an investment banker, following this trade, told a popular news agency.
As per Barclays, Indian healthcare market has significant long-term growth potential sharing similar growth drivers as other key regional markets.
Source: ET Medindia