EQT, TPG and KKR eye majority stake in HCG
EQT (formerly Baring PE AsiaEQT), TPG Capital and KKR are among those evaluating the acquisition of a controlling stake held by CVC Capital in Bengaluru-based specialty cancer hospital chain Healthcare Global Enterprises (HCG), sources told ET.
A rising middle-class and an aging population have boosted demand for private medical services across Asia, which in turn, is seeing massive consolidation and heightened deal activity in the healthcare sector.
Luxembourgbased CVC manages €188 billion of assets and is also owner of the Gujarat Titans’ IPL franchise, international rugby union, Women’s Tennis Association and top football properties such as Spain's La Liga or consumer brands like Lipton Teas, Peruvian cash management company Hermes, among others.
The US private equity fund owns around 60.41% stake in HCG.
BS Ajaikumar, an oncologist-turned-entrepreneur and founder of HCG, and his family members own about 11% stake in the company.
CVC bought a controlling stake in HCG in June 2020 for about Rs 1,049 crore by buying new shares and convertible warrants. It acquired more shares later through a mandatory open offer.
As on February 18, CVC stake in HCG would be worth around Rs 3,236 crore. The deal would involve an open offer for an additional 26% of the company. The current market value of the hospital chain is Rs 5,357.38 crore. A recent report by brokerage firm Jefferies also highlighted that CVC’s investment in the cancer hospital chain has increased 2.7 times in less than three years.
In the past one month,
