CEO Morning Brief

CVC Mulls Sale of Controlling Stake in Indian Hospital Chain Healthcare Global

Publish date: Wed, 27 Sep 2023, 09:05 AM
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TheEdge CEO Morning Brief

(Sept 26): CVC Capital Partners is exploring selling its controlling stake in Indian cancer hospital chain HealthCare Global Enterprises Ltd, according to people familiar with the matter.

The private equity firm is looking to identify buyers for its 60.4% in the Mumbai-listed company, said the people, who asked not to be identified as the information is private. CVC’s stake is worth about US$345 million (RM1.62 billion), according to data compiled by Bloomberg.

The buyout firm may seek a premium of at least 20% for the shares, one of the people said. It could even look for a premium of as much as 50% depending on market conditions, the person said.

Considerations are at an early stage and there’s no certainty they will result in a deal, the people said. A representative for CVC declined to comment, while a representative for HealthCare Global didn’t immediately respond to requests for comment.

A rising middle class and an ageing population have boosted demand for private medical services in Asia, accelerating deal activity in the healthcare sector. Luye Medical Group is weighing a sale of its oncology business in Singapore, while TE Asia Healthcare Partners is considering selling its oncology centres in Hong Kong, Bloomberg reported earlier this month.

HealthCare Global, founded in 1989 in Bangalore, owns 24 comprehensive cancer centres across India, its website shows. It serves more than 200,000 patients every year.

CVC bought a controlling stake in HealthCare Global in 2020 through buying new shares and convertible warrants. It acquired more shares later through a mandatory open offer. Shares of HealthCare Global have risen about 19% so far this year, giving it a market value of around US$572 million.

Source: TheEdge - 27 Sep 2023

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