Private equity firm Carlyle Group has picked up 27% stake in Gurgaon-based multi-specialty Medanta Medicity Hospital for Rs 960 crore, valuing the company at Rs 3,550 crore, or nearly $600 million. At this price, Medanta’s enterprise value per bed is Rs 2.8 crore whereas for Apollo Hospitals and Fortis Healthcare Ltd it is R1.4 crore.
The stake has been bought from US-based PE firm Avenue Capital. Medanta, which has a capacity of 1,250 beds, is co-promoted by Naresh Trehan and Sunil Sachdeva, who will continue to hold a 55% stake in the company.
Avenue Capital had invested Rs 2,24.6 crore in Medanta in June 2006 and the hospital chain had allocated 1.3 crore shares to the PE firm at a premium of Rs 162.82 per share. Based on the current stake sale, shares are valued at Rs 728.46 per share. Other shareholders in the company include 18% stake held by Punj Lloyd.
Apollo, India’s largest multi-speciality hospital chain, has a capacity of 8,420 beds and market capitalisation as on December 18, 2013 is Rs 11,439 crore and an enterprise value of Rs 11,979.6 crore. Fortis, which has a capacity of 5,400 beds, has a market capitalisation of Rs 4,757.4 crore and an enterprise value of Rs 7,528.9 crore.
Apollo and Fortis have also raised money from PE firms in the past. In October, Apollo announced its plans to raise Rs 550 crore through debt from US PE firm Kohlberg Kravis Roberts. Fortis has also raised Rs 250 crore from Standard Chartered PE and R570 crore from International Finance Corporation.
Cardiac surgeon Trehan started the venture along with Sachdeva after exiting Escorts Heart Institute. The Medicity Hospital project was conceived as Global Health in 2004 and became functional in late 2009.
At the end of September 2013, Carlyle had $185 billion in assets under management, with $62.2 billion in private equity. The investment will be made through Mauritius-based Anant Investments which is a special purpose acquisition vehicle, owned and controlled by funds managed by the Carlyle Group. Avenue Capital Group has approximately $12.3 billion in assets under its management, as of September 30, 2013.