The Manipal Healthcare Enterprises (MHE) has categorically denied that it is anywhere close to closure of the acquisition deal of Mumbai-based Balabhai Nanavati Hospital as reported in a media report here. However, the healthcare major has confirmed that it is in dialogue with several hospitals to tap inorganic growth prospects via the merger -acquisition (M&A) route.
“There is no such deal and we are no way close to closure. This is purely opportunistic and speculative news and in fact too pre-mature to even discuss”, Swaminathan Dandapani, executive chairman, Manipal Healthcare Enterprises told Pharmabiz.
India’s third largest healthcare provider in terms of beds strength after Fortis ad Apollo Group is now working to expand its reach in offering healthcare services. But it encounters escalating real-estate costs and paucity of doctors which are deterrents to increase footprint in the country via Greenfield project mode. Yet MHE is eyeing land acquisition opportunities in the Tier I and II cities.
“The reality is that there is need for more hospitals in the country to be able to provide easy, accessible and affordable care. This is where the government too should look at teaming up with existing large and medium hospitals to be able to offer the timely medical assistance to the scores of patients,” said the MHE executive chairman.
The big benefits of a strategic acquisition are expansion of medical expertise and being able to provide the patients the best of care at a faster pace. This saw MHE in 2013 acquiring the 70-bed Arunamari Specialist Medical Centre at Klang in Malaysia. In February 2014, it embarked on a similar exercise to buyout the 280-bed SK Soni Hospital in Jaipur which was also a maiden entry for MHE into Rajasthan.
Further, MHE also went for a Brownfield expansion in Goa where it increased the bed strength of its facility at Dona Paula by launching its 250-bedded hi-tech New Hospital Block, which is one of the largest multispecialty tertiary hospitals in Goa. With an investment of over Rs.100 crore, the new Hospital at Dona Paula houses six state-of-the-art operation theatres, 32 high-end medical & surgical ICU beds, the latest equipment including an MRI and CT, and a superior Emergency and Casualty Centre.
Over the last years, MHE has always opted to fund its expansions through private equity. In 2006, raised Rs.900 million of equity from IDFC Private Equity Fund II, a fund managed by IDFC Private Equity which was liquidated alter. In 2010, it approached Kotak Equity to raise funds to the tune of Rs.100-125 crore. In 2012 end it received a fund infusion of $180 million which was around Rs.1000 crore from India Value Fund Advisors.