India Resurgence Fund (IndiaRF), an India-focused investment platform promoted by Piramal Enterprises and Bain Capital, has invested Rs 525 crore (about $64 million) in Ivy Health and Life Sciences, marking its first investment in the healthcare segment.
IndiaRF has become the majority shareholder of Ivy following the transaction.
Established by Gurtej Singh and his wife Dr Kanwaldeep in 2007, Ivy Health and Life Sciences runs a super-specialty hospital chain under the Ivy Hospital brand in northern India.
As part of the transaction, IndiaRF will acquire Ivy’s facilities at Mohali, which is the group’s flagship hospital, and Amritsar, Khanna, Hoshiarpur, and Nawanshahr – all in the state of Punjab.
The transaction also includes a sizeable infusion of growth capital which will help further improve the breadth and quality of patient care services offered by Ivy’s existing facilities as well as expand its footprint to other cities in Punjab and adjoining regions.
“Post-Covid, there’s significant emphasis on providing localised healthcare in the form of multi-speciality regional hospital networks,” said Shantanu Nalavadi, Managing Director at IndiaRF. “Deepening insurance penetration has further augmented this shift as patients are increasingly looking for high-quality healthcare closer to home,” he added.
Meanwhile, Gurtej Singh, Chairman and Managing Director of Ivy Hospital, added, “What started as a vision to make quality healthcare, affordable and accessible in Punjab turned into a reality… We were the initial movers in this space who believed in the vast untapped potential for quality healthcare in the region, and I am excited to embark on this new journey with IndiaRF.”
O3 Capital acted as the exclusive financial advisor to IndiaRF and Unaprime Investment Advisors acted as the exclusive financial advisor to Ivy on this transaction.
IndiaRF invests capital from its $629-million maiden fund along with its co-investors in control situations with a focus on providing effective capital solutions and driving operational transformation towards reaching their optimal potential. It looks to invest in businesses that have fundamentally strong growth prospects linked to the consumption and infrastructure needs of India and sectors that have a strong standing in the global export market.
Ivy Hospital provides treatment to over 200,000 patients annually and has close to 1,100 beds across its six facilities.
The hospital segment in India has been of late witnessing increased M&A activity. While private equity giant KKR exited Max Healthcare in August last year, Canada’s Ontario Teachers’ Pension Plan (OTPP) agreed to acquire a significant majority stake in Sahyadri Hospitals Group from Everstone Group the same month. The latter marked OTPP’s first control private equity buyout in India.
More recently, Singapore state investor Temasek has acquired an additional 41% stake in Manipal Health Enterprises, taking its total holding to 59%.
Separately, Manipal Health Enterprises also made headlines when it acquired Kolkata-headquartered AMRI (Advanced Medical Research Institute) Hospitals for Rs 2,400 crore.
In March this year, IIFL PE, a private equity fund managed by IIFL Asset Management Limited (IIFL AMC), invested $70 million in Sri Kauvery Medical Care (India) Limited, which owns the Kauvery Hospitals chain. DealStreetAsia