Hyderabad: Omni Hospitals, a healthcare provider based in Hyderabad, backed by private investment firm ASK Pravi Capital Advisors, is in congress with nearly a dozen PE companies to increase about 50 million Dollars (322 crore), which includes an outflow to the investor PE flow.
ASK Pravi Capital Advisors had invested approximately 50 crore in two tranches and currently holds approximately 35% stake in Omni Hospitals.
Two people who are aware of the talks told ET that the healthcare business, which is part of the INCOR group, uses Spark Capital’s financial advisory services, which had so far helped 19 service providers $ 450 million to be collected.
The latest agreement that Spark Capital informed was Apollo Health and Lifestyle carrying 450 primary equity credits from IFC and IFC Asset Management Company.
Some of the healthcare providers that Spark Capital helped raise funds include Ramesh Hospitals, Health Highway, Vasan Healthcare, Kids Clinic, Vaatsalya Healthcare and Medall Healthcare, among others. Omni Hospitals took advantage of Spark Capital twice earlier to raise $ 5 million in July 2013 and $ 8 million in September 2014.
“Global consulting giant KPMG has completed due diligence by the Omni Hospitals provider and Spark Capital is providing these details to a dozen PE companies for due diligence,” said one of the people. “The Hyderabad Company hopes to sign financing leaflets with potential investors in 6-8 weeks to complete the fundraising exercise around September.”
Established in 2009, Omni hospitals currently have six hospitals under its cover, including three in Hyderabad and one in Visakhapatnam and Kurnool in Andhra Pradesh and one in Cuttack in Odisha with a cumulative capacity of 800 beds. The hospital now seeks to raise more than 300 crore to set up six additional hospitals in Bengaluru, Raipur, Mysuru, Pune, Indore and Bhubaneswar to take the total capacity to reach 2,000 beds in three years.
“The management of Omni hospitals hopes a business valuation of about 500 crore where it plans to divest about 40% to exceed $ 50 million (322 crore), including an outflow for ASK Pravi Capital and will deploy balance funds To expansion, “said another person. “The dilution of equity may vary depending on the interest of potential investors in structuring the infusion of funds – full equity or a combination of equity and debt.”
When contacted, Omni Hospitals CEO Surya Reddy Pulagam confirmed his intention to mobilize the next round of capital to support the expansion and also provide exit to the existing investor. However, he refused to disclose details on the amount of funds they were seeking to raise and the PE companies with whom they were in congress. One of the people known above said: “There are dozens of PE companies and global investors that Spark Capital has addressed with the details of due diligence of vendors performed by KPMG. Some of these investors include IFC , Advent International, Faring Capital, Aster DM Healthcare and Piramal Group, among others. “
However, ET could not independently check with these PE players on their interest.
Spark Capital did not reply to ET’s mail for comments and details.
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Hyderabad, also known as India’s healthcare capital, has witnessed the interest of many European and international investors who have taken over stakes in many healthcare providers over the past few years.
Some of them include the Malaysian health services giant, IHH Healthcare Berhad, which buys 73.4% in global hospitals for about 1,300 crore and 51% in continental hospitals for about Rs 300 Crore, Aster DM Healthcare buys An undisclosed majority stake in Prime Hospitals for $ 12 million and Dubai The investor in educational development, the Abraaj group, reportedly bought 72 percent stake in Advent Capital in Care Hospitals for about 1,300 crore.