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Manipal Hospital, along with -TPG in talks for acquiring stakes in Columbia Asia’s India assets

Manipal Hospital

According to the sources, consortium of Manipal Hospitals and TPG Capital Management have decided to acquire Seattle based healthcare chain Columbia Asia’s Indian hospital assets in a Rs 2,000 crore deal. Amongst other bidders, Manipal Hospitals and TPG Capital Management have landed up in a conclusion that by the fiscal year-end, the transaction will be out in market.

“Negotiations are advancing faster and we hope to conclude it by March,” said one of the people cited above. Morgan Stanley is running a formal sales process to find a buyer, the people said.

The stake being sold was Columbia Asia management’s decision to exit Asia operations.

TPG was part of the consortium — along with Malaysian conglomerate Hong Leong— that bought rest of the Asia operations of the Seattle-based chain. Columbia Asia hospital comprises of a total bed strength of around 1,200 with another 200 beds under construction. It has six hospitals in Karnataka and one each in Maharashtra, West Bengal, Uttar Pradesh, Punjab and Delhi. The deal is bound to make Manipal as one of the top healthcare chains in the country. Presently, it owns 10 multi-specialty hospitals, five teaching hospitals and several fertility clinics. It’s present in Bengaluru, Mangalore, Vijayawada and Goa with a bed strength of around 6,000, its website showed.

Backed by private equity groups Temasek and TPG, Manipal Hospitals was known to be in final discussions for acquiring about 82% stake in Medanta-The Medicity, at a valuation of $820 million, however the deal wasn’t that fruitful.

Manipal was also engaged in negotiations to acquire other assets such as Hyderabad-based hospital chain Star Hospitals and Kolkata based AMRI Hospitals Ltd.

Texas-based TPG is one of the most aggressive investors in the Indian healthcare space.

In 2017, it created Asian Healthcare Holdings (AHH), a platform to invest in healthcare assets. Separately, it invested $146 million in Manipal in 2015. TPG Capital, the buyout arm of private equity firm TPG Group, holds a 25% stake in Manipal Health Enterprises while the Singapore government’s investment arm Temasek Holdings Pte Ltd holds 18%.

Columbia Asia, in its response, said, they were evaluating a stake sale. “We can confirm that we have retained Morgan Stanley to run a process to identify investor(s) for Columbia Asia’s future growth in India and have considered all options including a 100% sale of the company to such investors. However, we are unable to provide further comment at this time, “Nate McLemore, Managing Director, Columbia Asia told ET in an emailed response.

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